There are now a number of ways you can effectively save money for either the long or short term. One way is through a time deposit investment. This is a fixed term savings account where as long as you leave the funds in place for the specified time, an enhanced interest rate is attached to the product. There are penalties for early withdrawal or not giving notice to withdraw during the term but there are a number of benefits to choosing this route.
- It encourages a savings habit
The money you decide to deposit has to be in the account for a set period of time without you withdrawing any of the funds. This is great for those who want to be disciplined in the way they save and know that being tempted to withdraw money will cost them financially.
- Higher interest rate
Time deposit investment opportunities mean that you will be rewarded with an enhanced interest rate. It’s an ideal product for those looking to make investments where they know they don’t need the cash any time soon and know that on maturity they will receive more interest than leaving it in a standard savings account.
- Assured of returns
Having this kind of product means that you’ll know there’s a return on maturity as there’s no risk attached to the investment – as long as early withdrawal is not made.
There’s a huge range of fixed terms available; any length from 30 days to five years is standard and there are also products which are as long as 10 years.
- More than one account
If you have a number of savings goals and want to put certain amounts of money aside for different lengths of time and then know each will give a good interest rate at the end, time deposit investments are excellent. This is because you can have a number of accounts and so divide the money accordingly.