When we deposit money for a fixed term, what aspects should we pay attention to?
Fixed deposits are one of the most popular and safest deposit products among the public, and they have always been in high demand. However, when saving money, people do tend to fall into some misconceptions or unknowingly step into some pitfalls. Today, let's summarize five things you should absolutely avoid when making a fixed-term deposit.
Firstly, never opt for automatic renewal. Since the marketization of interest rates, various banks have increased their fixed deposit interest rates to attract deposits. This means that the current fixed interest rates are higher than the benchmark rates published by the central bank. For example, the current interest rate for a three-year term large certificate of deposit is generally between 3.35% and 3.55%, while the central bank's published rate for the same term is only 2.75%. If we choose automatic renewal when making a fixed deposit, the interest rate for the next deposit period will automatically change to the central bank's benchmark rate, which will be much lower than the bank's execution rate, making it very inappropriate.
Secondly, never blindly choose long-term products. One of the characteristics of fixed deposits is that the longer the term, the higher the interest rate. However, a longer term is not necessarily more suitable for us. Since the central bank abolished the "tiered interest" policy last year, any fixed deposit that is withdrawn early will be calculated at the demand rate. This means that if you have a long-term fixed product and suddenly need money for an emergency before it matures, the loss from early withdrawal would be significant.Therefore, when handling term deposits, it is essential to choose products with suitable terms based on one's actual situation.
Thirdly, be wary of deposits turning into insurance or wealth management products. Term deposits, wealth management products, and insurance products are three completely different financial tools, and their distinct features are well understood without further elaboration. However, if you are preparing to deposit a term and cannot resist the so-called high returns of wealth management and insurance, choosing such products will completely alter all your subsequent financial planning expectations. For instance, wealth management products cannot be withdrawn early, and insurance requires continuous payments for several years, among other stipulations. It is crucial to understand these details in advance.
Fourth, do not exceed 500,000 yuan in the same bank. This guideline is primarily based on the regulations of our country's deposit insurance system. According to the deposit insurance regulations, if a bank goes bankrupt, depositors can enjoy protection for deposits with principal and interest not exceeding 500,000 yuan. This means that if the bank where you have deposited your money goes bankrupt, the national insurance system can compensate you up to 500,000 yuan at most. Consequently, when depositing, especially with smaller banks, it is important to keep the amount within 500,000 yuan to prevent financial loss in the event of the bank's bankruptcy.Fifth, never disclose your password to others.
Many friends, especially the elderly, write their passwords on deposit slips or the back of cards to prevent forgetting them. However, this practice turns your password into plain text, and if lost, there is a risk of being taken away.
Some friends may inadvertently reveal their passwords to others, such as not covering when withdrawing or depositing money, or inadvertently leaking them over the phone or on the internet. These are all very dangerous behaviors, and everyone must pay extra attention.
In summary, fixed deposits are one of the most accepted, popular, and frequently handled financial methods. When handling them, we should be extra careful. If there is an operational error by the bank, resulting in the wrong product being processed, or if one's own negligence leads to irreparable losses, it would not be worth it.
So, what other strange, funny, or memorable things have you encountered when handling fixed deposits?
We welcome your comments and discussions to explore together.
