1. A debt fund can be equally liquid as your sweep-in bank account for your withdrawal needs.
2. For a sweep-in account, you will also have to fix a threshold limit in your savings account, and that amount will continue to remain in the savings account for the entire period.
3. Another glitch is that you will be entitled to the interest rate of a fixed deposit only for durations that your particular amounts remain in the sweep-in account.
4. Hence, it is important to go through the terms and conditions of the bank account carefully.
5. In some accounts, you might have to shell out a penalty if your balance drops below the minimum quarterly or monthly requirement due to some urgent unforeseen withdrawals by you.
6. This implies that your gain from the sweep-in account could be wiped out instantly.
7. Moreover, such withdrawals will attract Tax Deducted at Source (TDS) provisions every time.
8. On the other hand, there is no TDS in debt funds, besides giving you indexation benefits and possible benefits in interest rates at times, being market-related investments.
9. Sweep-in account is, however, suitable as a flexi-deposit account with sweep-out facility too, for intermittent parking of funds in either savings bank or flexi-deposit accounts operated on a regular basis, for those who are not too concerned about TDS, which they would reclaim while filing income tax returns.
2. For a sweep-in account, you will also have to fix a threshold limit in your savings account, and that amount will continue to remain in the savings account for the entire period.
3. Another glitch is that you will be entitled to the interest rate of a fixed deposit only for durations that your particular amounts remain in the sweep-in account.
4. Hence, it is important to go through the terms and conditions of the bank account carefully.
5. In some accounts, you might have to shell out a penalty if your balance drops below the minimum quarterly or monthly requirement due to some urgent unforeseen withdrawals by you.
6. This implies that your gain from the sweep-in account could be wiped out instantly.
7. Moreover, such withdrawals will attract Tax Deducted at Source (TDS) provisions every time.
8. On the other hand, there is no TDS in debt funds, besides giving you indexation benefits and possible benefits in interest rates at times, being market-related investments.
9. Sweep-in account is, however, suitable as a flexi-deposit account with sweep-out facility too, for intermittent parking of funds in either savings bank or flexi-deposit accounts operated on a regular basis, for those who are not too concerned about TDS, which they would reclaim while filing income tax returns.