Money in the bank

@beamer88 (4268)
Philippines
February 11, 2011 2:53am CST
With the very small interest you earn from your savings account in banks, should I still keep my money with them or invest it somewhere else? The amount is not that big but sometimes I feel that I should withdraw it and put it in another instrument that yields a much higher earning.
2 people like this
15 responses
@Downwindz (2231)
• Netherlands
11 Feb 11
Depending on the amount it could maybe be adviseable to invest them in bonds, but this also depends on your banks and the possible fees. But investing in bonds you often get the best result if you are able to let your money stay in the invested bonds until they expire. So we talk about a 2year+ investment maybe.
@beamer88 (4268)
• Philippines
11 Feb 11
That's another option. Are bonds riskier than stocks or mutual funds?
@Downwindz (2231)
• Netherlands
11 Feb 11
bonds are alot safer than stocks. Mutual funds I have not been investigating into since im not sure if we have those available in my area :) Must check that. Basically bonds have a listed value when they expire plus an interest rate, for example. Value 100 - Interest 4% - this means that if you buy the bond for 97 then you will still earn the Interest of 4% (monthly, quarterly or yearly - depends on the bond) plus once it expires you will be paid its value of 100. - you can also choose to sell the bond earlier if the value is better before it expires.
@Downwindz (2231)
• Netherlands
11 Feb 11
A short investment on Mutual funds tells me it is also riskier than bonds - to list them it would be Bonds - little risk Mutual Funds - medium risk (they are based on investment in stocks and bonds) Stocks - higher risk
@stanley777 (7177)
• Philippines
8 May 12
I think investing is risky and in the bank is safer.. But then as you said, the interest is so little..investing is better as long as you have a good idea where to invest it where it would surely grow. i tried investing a few times but none of it succeeded.
@beamer88 (4268)
• Philippines
30 Jul 12
I guess the more risk one entails, the higher the revenue we could expect. I had invested small amounts on a few non-bank stuff, and I'm glad I'm earning from them even though the amount is just a little more than if I put it in the bank.
• Philippines
3 Aug 12
Yes, it's true. Most businessmen practiced this method. They invests their money and if they got lucky their investments do the earnings for them. It's like gambling I guess.
• United States
12 Feb 11
The only advice I can offer to you is to go where YOU feel most comfortable to save money. You need to take into account a lot of factors: How quickly do you need to get your hands on the cash? Is the place you've selected FDIC (US-based banks only) insured? Is the location easily accessible? Can I get to the money fast and without penalty? How long until I need the cash? Think about all of those questions before making a final decision. Good luck in whatever you choose!
@beamer88 (4268)
• Philippines
13 Feb 11
Yes, these are the same factors I've considered especially getting the money fast. I'm really looking more at short-term investments.
• United States
13 Feb 11
How fast are you looking to make money? The fastest 'safe' method (FDIC-insured) is via a bank CD--30 days seems to be the shortest term for smaller ($10,00USD accounts). I am learning about currency trading too, but won't take a chance until we have a cushion of savings.
@sharra1 (6342)
• Australia
12 Feb 11
If the money is solely for saving and not everyday money then it can be good to find alternative places. The problem is that the higher the yield the higher the risk. Finding a safe investment that yields more money is the best option. This can be done with term deposits in banks or bonds. I keep most of my savings in an ING account as it pays higher interest and is easy to access. That is for money I need to have on call. If I could afford to put it away for a while I would probably go term deposit.
@beamer88 (4268)
• Philippines
13 Feb 11
I have a small portion of my money in term deposits but the yields are not that high compared the mutual funds or bonds.
@sharra1 (6342)
• Australia
13 Feb 11
It is all a matter of balancing risk and gain. The bonds sound reasonably safe. The share market is not. I have some money in super which I can access soon and when I do I shall take it out and bank it in a high interest account. The super account in in shares and I watch it go up and down and hope it stays up. I would prefer a safer place but the company's cash option pays less than banks in order to force you into shares.
@payout (3722)
• United States
11 Feb 11
Hey beamer, I have a checking and savings account with my bank n they add money every time ipay my bill it's consider credit not much but I guess it's nice. Usually the percentages of the interest that is given bank isn't much to honest in most banks. The intrest isn't much at all. I have a capital one credit card. And they give you 1.25% annually then 10% of the 1.25% quarterly that's not normal. To me it's better for anyone who has thousands saved in a account. You can earn from it. For example , if you have $10,000 in your account with 1.25% they will give you $125 in a year free now you divide that by 12 which is $10.42 then you time that by 3 n get 31.26 then you add 10% which is 3.126 add that to 31.26 and get 34.38 then times it by 4 and get 137.544 in a year so the you gain a total 12.504 from the 10% So to me interest is awesome for people with a lot of money in there savings
@beamer88 (4268)
• Philippines
13 Feb 11
Yes, your earnings would be higher if you have a huge amount of money parked in the bank. I usually do some imaginary computations if I have this amount or that amount of money :) But I don't have that much so the interest I earn is really very small. My money gets a higher return by doing retail selling. A 10% markup for example is way higher than what the banks offer. Why is it that for you to make money, you have to have money? :)
1 person likes this
@payout (3722)
• United States
15 Feb 11
Haha after i wrote this responses I realize I did the math the long way all you do is get e interest amount at the end of the year and add 10% of the interest amount added in the end. Which equals the same thing in the end haha I had a slow moment haha. It does seem that way sometimes haha. Or maybe you have to spend money to get money like when we get a job we spend money on work clothes and etc. Haha. We spend money printing out our resumes and giving out copies we spend money on gas to get where we need to get or we need to spend money for the bus to get where we need to go lol . The more money you have in the bank the better haha
@varier (5699)
• Indonesia
29 May 12
I don't really put money on bank for interest, it's more about having great facilities. I need the ATM, online banking, and wire transfer as well. It surely makes my life easier.
@beamer88 (4268)
• Philippines
30 Jul 12
Oh, I agree with you on this. Especially a bank's online facility. It really makes one's life easier :)
• India
4 Mar 11
Yes, money in Banks is safe. But are you compromising on returns for sake of safety. Remember, money in Bank would not even cover the inflation and thus, you are actually losing your money as the value of your money is getting lower and lower day by day. You can visit my blog (given in my profile) for other ways to improve your returns without compromising on risk.
@beamer88 (4268)
• Philippines
4 Mar 11
That's true. Banks are like personal vaults. Your money is kept safe but doesn't earn. I'll check out your blog. Thanks.
• Singapore
25 Feb 11
Banks continue to play us close to nothing in interest. What they are giving will not even cover inflation rate in most countries. As such, there is a need to invest the money that you have in other instruments that has the potential to generate higher returns such as in mutual funds. Of course, there are risks in mutual funds, but you get to choose the ones that are less risky in nature. Once you get more acquainted with mutual funds and how best to invest, then you can look into the more "aggressive" funds". At the same time, make sure that you do asset allocation for your funds and not just put your eggs in one basket.
@beamer88 (4268)
• Philippines
25 Feb 11
Yes, that's precisely what I plan on doing. I really need to start investing on less risky portfolios. And I'm still keeping some in my bank just to be on the liquid side of things.
@lady1993 (17676)
• Philippines
12 Feb 11
I still put m y money in the bank even though the interest is really low now, it's safe there anyway. But I also think it's good to invest it, make a small business or something- if you're successful, then that small amount of money would become really big. But I won't do that until I finish school.
@beamer88 (4268)
• Philippines
13 Feb 11
Yes, finish your studies first :) That's more important than investing for now.
@shia88 (4582)
• Malaysia
12 Feb 11
Hi, I do agree that nowadays the bank is offering very low interest for saving account or even fixed deposit. Although putting money in the bank is safer,but earning such a low interest does not make any good effect. If I were to have huge sum of money, I will use partly for investment either in share and property. Property markets is pretty good now and the price of houses keep rising up,it is good to have small investment in property which will definitely earn me money in future. Of course, investing in share is good,but it is more risky. Unless you really have extra fund in hand and wanna try to invest some in shares,you can always choose those good shares and keep few lots for long term investment.
@beamer88 (4268)
• Philippines
13 Feb 11
Investment in properties is really a good option for someone with a significant amount of money. Properties are also good collaterals when you're applying for business loans.
@nj_1022 (251)
12 Feb 11
I also think that money in the bank does not grow so much interest unless you put it in stock or investment.
@beamer88 (4268)
• Philippines
13 Feb 11
They really don't. Stocks is definitely a good alternative to earn higher yields.
• China
12 Feb 11
There are two kinds of account, one is current account, the other is savings account. In china, the interest of current account is 0.36% a year, that of savings account is 3% a year. the interest for 2 years and 3 years is higher, if you have a great sum of money, you can have good interest fortune by open a savings account.Due to growing inflation rate, the government may raise the interest even higher to reduce the flow of liquidity. It's a good choice to invest in a savings acount.
@beamer88 (4268)
• Philippines
13 Feb 11
In our country, current accounts earn the same as regular savings account. Some current accounts are even non-interest bearing. But they also vary depending on the amount if money deposited.
• United States
11 Feb 11
Yeah the interest from a simple savings account is really small unless you have very large quantities of money, making the interest payment worth it. The problem is getting a very large sum of money through other investments. I don't really know how much you have so its hard to say what to invest in. I personally am saving most of my money for the stock market and trading futures/options. I really want to learn everything there is about trading. Maybe some small real estate or start a small business that you see potential profits from.
@beamer88 (4268)
• Philippines
13 Feb 11
Yes, a small business is one of my options. I too want to learn more about trading. I've been intrigued by news about people making it big in the stock market.
@Lhenni (1246)
• Philippines
11 Feb 11
We are in the same thought of thinking for a profit than just in a bank. I've just done attending seminar 'bout Stocks & Bonds. They explained it and made me see that if you invest your money in there, it will be doubled in every 6 years. I'm just waiting for a go signal from my husband. Like you, i'm not happy with the gains, the bank is offering... it's so low. We're into a "Special Deposit Account" in one of those leading bank here that offers a much higher revenue than just a normal deposit account they have. In every 500,000 pesos, you will have a 1,100 pesos as gain in every month, tax free. But compare to Stocks & Bonds investing, it's chicken. 'just hoping that you too, may find yor way for your money to a better investment that offers a reliable & fruitful one.
@beamer88 (4268)
• Philippines
11 Feb 11
I'm also thinking about investing in stocks but I still need to gain some knowledge about it. I'm considering mutual funds also. Our banks have UITFs and I think you don't need to big an amount to invest in that kind of instrument. Thanks for the encouragement :) One has to be careful when dealing with his hard-earned money.
@rsa101 (13336)
• Philippines
11 Feb 11
If you know of a safe investment around your place then place something there to have your money work for you faster. But if there is none around your place, then better put it there and be happy with what you can get from it. Putting your money to earn is not just like what we do in a bank where we just deposit and do nothing with our money. Investing means constant checking of you invested money and being able to see it grow or decline.
@beamer88 (4268)
• Philippines
11 Feb 11
That's one of the reasons why I'm a little hesitant in withdrawing the money. Investing has its risks. Oh, well, we need to take risks once in a while :)