Is it time to move money from savings accounts to debt mutual funds?
Financial planner: Santosh Joseph, Founder, Germinate Wealth Solutions, a financial planning firm, based in Bangaluru.
Questions asked by his clients:
1. Since banks are cutting interest rate, should we move our savings to liquid or overnight funds?
2. Should we use liquid funds as an emergency account since it has instant redemption.
3. Are Debt funds safe for our FD proceeds?
His response to clients:
Bank saving deposit rates are coming down and this definitely gives debt mutual funds an edge over the savings bank account in terms of post-tax returns. However, the comparison is not that easy. The call gets tougher when you are in the middle of a pandemic with serious threat to your salary and job. On the other, all investment products, debt mutual funds included, are facing numerous challenges. So ..