The best way to make your money work for you by comparing and selecting the best financial product for your needs, with better value, lower fees and more additional benefits. For example, by simply moving your unused cash from a current account into a fixed deposit, you can reap three times more interest.
The UAE is one of the most competitive markets especially for financial products: taking some time to look around, compare and pick the best-fit product can bring real savings with little effort.
Current to savings account
The average balance on a current account in the UAE is AED 40,000. By moving funds you do not need for everyday spending to a savings or fixed deposit account at 4%, you can earn AED 1,600 for the year. The RAKBANK F@st S@aver account provides an interest rate of 2%. Make sure, however, that you take a good look at the fees associated with this, such as monthly maintenance fees of the account.
It is best to pay off your credit card at the end of every month. However, banks are promoting their balance transfer credit cards to offer customers a way to ease the repayments. The average balance on a credit card in the UAE is AED 2,800 and with an average monthly of 3% rate, your interest for the year would amount to AED 900. By doing a 0% balance transfer for the first 12 months, you can save up to AED 850 taking into consideration an average of 1% processing fee for the transfer. However, carefully look into the fine print, such as processing fee or the rate applied after the 0% transfer period is over.
Many credit card providers now provide installment plans. This allows you to take a big purchase made on your card, and convert it to monthly installments (usually 6 months). This reduces the amount of interest you pay for the transaction, as you are usually charged a lower interest rate than the regular credit card rate. In addition, easy installment plans force you to make a regular monthly payment till the balance is paid off.
Most personal loans in the UAE require a salary transfer. Without a salary transfer, the rates are normally higher. If you can afford to move your salary account to the lending bank and you meet the actual eligibility criteria of minimum salary, your rate can significantly decrease.
While insurance is essential for peace of mind and in case of unexpected events, it’s important for consumers to ensure they are doing everything they can to get the best premium on their renewal. First of all, get a quote from different providers. Make sure you have asked for your No Claims Certificate from your current insurer and make sure you check the items covered on your premium.