Saving and Investing

You're already comfortable with the importance of saving. Putting money into a bank account on a regular basis allows you to build up a cash reserve. You can use that reserve to pay for things that are outside your everyday budget, such as a family vacation or the down payment on a new car or a home of your own. Your savings can also provide an emergency fund that you can draw on to cover unexpected costs that can crop up — such as illness or injury.

There are many types of savings accounts some of which are mentioned below:

Transactional Savings Account: These accounts allow you to make regular transactions (deposit/withdrawal) and pays an interest on the deposit balance. There are various ways the interest can be calculated e.g. on average periodic (monthly/quarterly/half-yearly) balance or day end balance. At times there might be a provision for interest forfeiture if no. of transactions exceed a certain limit.

Term Deposit: Term deposit accounts allow you to deposit a sizeable amount for a fixed term. Upon maturity you can withdraw the principal along with interest. Interest rates are usually higher for term deposit accounts than that for transactional savings account. At times options are also available to withdraw the interest monthly instead of on maturity.

Savings Scheme: Savings Schemes are usually monthly deposit based savings account where you can make a fixed amount of deposit every month for a preset no. of months. Upon maturity, you can withdraw the principal along with interest. This sort of savings scheme is ideal for saving a portion of the monthly income for a future expense.

Additionally, you can also invest in Govt. issued bonds in Bangladesh. Banks in Bangladesh offers Govt. bond related services to their customers including bond purchase, encashment, coupon redemption and renewal. Both resident and non-resident Bangladeshis can invest in Bangladesh Sanchaypatra and Tri-monthly Sanchaypatra. Non resident Bangladeshis can also invest in Wage Earner Development Bond, US Dollar Investment Bond and US Dollar Premium Bond. The tenure of these bonds range from 3 years to 5 years and these bonds offer attractive interest rates.