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donnell
Apprentice
Joined: 30 Jan 2006
Posts: 7
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 Posted: 10/03/07 - 09:54 Post subject: |
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| I find a better job last month. Of course with a better salary to. Therefore, now I have some extra money every month. Because I do not spend it in my bank told me that I should consider opening a reverse sweep accounts. He said something about that with this type of account I will use that extra money wiser. I did not really understand him about this subject, so if anyone can clear this to me, I will be very grateful. Which bank offers best short term savings? |
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artemis
Apprentice
Joined: 25 Nov 2004
Posts: 8
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| Posted: 11/04/07 - 23:23 Post subject: |
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| If you earn enough money to be able to save something at the end of month, you should invest that money in an avenue that gives you the flexibility to access your savings if you need it. However, that investment should give handsome returns when it is idle in your bank account. Usually bank gives about 4 per cent interest per year on savings account. If the money is put into a fixed deposit account with a better interest than it is not at your disposal. Therefore, what you need is a mix of the features of a savings current account and a fixed deposit account. The solution may be a reverse sweep account. The interest on this account is much hire then on the standard savings account. With no minimum balance requirement, one has to keep a fixed deposit. However, when you are in need of cash, the bank can just transfer or 'sweep' in funds to your savings account. When a customer issues a cheque or wants to withdraw an amount which is more than what is in his/her savings account, the bank will just automatically break the fixed deposit account and transfer the needed amount of money to your current account. |
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