Three Safe Ways To Keep Cash

Three Safe Ways To Keep Cash

2019/02/25

Holding too much cash at home can be a risky proposition for an individual. It is important for every individual to manage his/her cash properly in accordance with the amount of money that may be required to meet day to day expenditure. Cash may be used for purchasing grocery items, food, clothes, or for irregular purchases such as laptop, mobile phones and so on.

However, with increase in use of credit cards, the requirement for keeping cash at home has declined. Excess amount of cash can be used for investment purposes which may yield additional return to an individual.  Further, it reduces the risk of loss of cash resulting from theft that is quite common nowadays.

Three Safe Ways To Keep Cash

Deposit Excess Cash In A Savings Account:

Any amount of excess cash available with an individual should be deposited in a savings bank account. Keeping idle cash at home may not fetch any extra income to the individual. By depositing cash in a savings bank account, an individual can earn interest income on his/her account balance. For Instance, an individual is holding an amount of $ 10,000 in cash.

His estimated requirement for the month of June 2011 is $ 2,000. He can deposit up to $ 8,000 in his bank account and earn extra income in form of interest on the actual amount deposited by him.

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Use Extra Cash For Investment:

Extra cash can be used for making investments in different types of securities such as corporate bonds, treasury bills, stocks and so on. It is important to note that these types of investments may require payments through a check or any other bank instrument. Hence, an individual can deposit excess cash in his/her bank account and invest in these types of financial securities.

Different kinds of investments offer different types of return over a period of time. An individual can make multiple investments depending on the amount of cash that is available with him/her at any point of time. It is important to note that these investments may be subject to a lock in period and hence the amount of cash so invested may not be readily available for use by the individual.

Use Cash For Purchases Or Utility Bill Payments:

In case more than required amount of cash is available at home, an individual should try to use cash for his/her purchases instead of using a credit card or debit card. For Instance, an individual has an urgent requirement for a mobile phone. Even though he/she can make payment through his/her credit card, he/she should first try to use excess cash that may be available for making the payment.

Similarly an individual can use cash for paying premium on his/her vehicle or life insurance. An individual can also use cash for payment of utility bills like telephone and internet, electricity, water and so on. Even though most of these payments can be made directly in cash, an individual can deposit relevant amount of cash in his/her bank account to avail benefit of electronic payments.

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