As inflation continues to bite and everyday expenses rise, people may be struggling to protect their hard-earned money while seeking decent returns.
Traditional bank accounts now offer minimal interest, while investing in a volatile market like stocks can be risky and unpredictable.
People are now looking for safe and high-yielding savings options that help them protect their money from loss while earning good returns. For example, the inflation rate is 7 per cent, so the best way to grow your money is by investing in those places that give you an 8 per cent return or more.
Here are some of the most reliable options for investors seeking to grow their wealth without undue risk.
Government-backed Savings Schemes & Post Office Schemes
Public Provident Fund (PPF)
PPF remains one of the most trusted long-term savings instruments offered by the government. It offers a safe haven with compounded interest and tax advantages under Section 80C. This means that you don’t have to pay tax on the money you invest or earn as interest.
However, PPF has a lock-in period of 15 years, which means you can’t take all the money out before this period. But partial withdrawals are allowed from the 7th year onwards. Early closure of the account is only allowed after 5 years in certain cases, like serious illness, higher education, or financial emergencies.
Sukanya Samriddhi Yojana (SSY)
Sukanya Samriddhi Yojana is a government-backed savings scheme for the girl child. The scheme, part of the Beti Bachao, Beti Padhao campaign, helps parents save for their daughter’s future education and marriage. SSY accounts offer an 8.2 percent rate of interest, which is one of the highest interest rates among small savings schemes.
Under Section 80C of the Income Tax Act, 1961, individuals can claim a tax exemption up to Rs 1.5 Lakh from the amount contributed to SSY account.
National Savings Certificate (NSC)
The National Savings Certificate (NSC) is a secure, fixed-income investment by the government, offered through Post Offices. The current interest rate is 7.7 percent. There is no TDS on interest earned. Investments up to Rs 1.5 lakh in a year are tax-free under Section 80C.
The lock-in period is five years. The minimum deposit amount is Rs 100 and there is no limit for maximum deposits.
Bank Fixed Deposits (FDs)
A Fixed Deposit is a popular way to save money safely in banks. You deposit a certain amount for a fixed period, and the bank pays you interest on it. You can choose a tenure for your deposit, from 7 days to 10 years. Longer FDs usually give higher interest.
The best part is that you will continue to get the interest that was initially agreed upon, even if interest rates drop. Compared to investments in other assets like equity, FDs are believed to be far safer.
Tax-saving Fixed Income Options
Several government-backed and low-risk options provide tax benefits under the Indian Income Tax Act, primarily Section 80C.
Tax-saving FDs lock funds for 5 years and qualify for deductions under Section 80C but interest is fully taxable. In contrast, government small savings schemes like PPF and SSY not only reduce taxable income but also offer tax-free interest.
Digital and Hybrid Savings Options
In 2026, digital platforms are reshaping how people grow their cash. Here are RBI-approved high-interest digital savings accounts.
Ujjivan Small Finance Bank
The RBI-regulated Ujjivan SFB lets you open a savings account online with competitive interest rates and easy app-based banking. It can be opened instantly with an Aadhaar card and a PAN card. Digital Savings Accounts have made banking services available 24/7, so there will be no need for physical branch visits.
In contrast to premium accounts, which could force you to keep a sizable minimum balance each month, digital savings accounts just require a modest amount.
Jupiter Savings Account
Jupiter is a digital banking app that lets you open a savings account online with Federal Bank. It is fully paperless so you can open the account from your phone in minutes. Jupiter’s savings account earns interest on your deposited balance.
There is also no need for a minimum account balance. You will also get 1 per cent cashback on debit card, UPI and on digital gold.
Key Tips for Maximising Returns
Combine schemes for diversified risk
It’s better not to put all your money in one place. Different savings options serve different purposes. As no single product fits all goals, there is a need to blend long-term options like PPF and SSY with medium-term NSCs or bank FDs and short-term digital deposits. So, if one investment earns less or takes time, the others can balance it out.
Track interest rate changes and inflation impact.
Interest rates change over time. Some investments, like FDs or NSCs, may offer higher or lower rates depending on the ongoing economic conditions. Inflation reduces the real value of your money. For example, if your FD gives 6 per cent but inflation is 7 per cent, your actual gain is negative.
So, it would be better to move money to places that give better options.
Liquidity vs returns
Liquidity means how easily you can access your money when you need it. Returns are how much profit or interest you earn on your investment.
There are times when long-term schemes offer the best returns but limit access to funds. For example, if you need money in the near term, such as for education or home renovation, then there is no point of locking your money in PPF or any long-term options.
Long-term options lock your money for years but give higher returns. While short-term options like digital savings allow quick access but may give lower interest.