How to choose the best term for a deposit

If you have a saved money and you have thought about a bank deposit, you will surely have doubts about where and how to place it. From .com we only want to show you some parameters that you must take into account and so you can choose the best term for your deposit . Surely the most important and most influential factor in the selection of a deposit is the term, which can vary from 1 to 5 years. Thus, you must take into account if you are interested in having a long-term profitability or not. For this it would be interesting that you consider the following before hiring the deposit.

Steps to follow:

one

The availability of liquidity that allows the deposit is one of the factors that you should prioritize before choosing the term your deposit and the entity. Some deposits allow early cancellation, although you may be penalized; but there are other deposits in which you have total availability of your money. Choosing a long-term deposit that does not allow prior cancellation can be a trap, especially if you are not sure that you will not need to have the money in the near future.

two

Before hiring the term of the bank deposit you must also take into account the economic situation . If it is foreseeable that interest rates will rise soon, it is not advisable to open a long-term deposit, since we will be tied hands if new offers improve that of the current deposit . And the other way round: if you anticipate a period of low interest rates, a good long-term return may be more interesting to choose your deposit .

3

The future need you may have of money is also important to choose the best term . If you consider that you may need the deposit money in advance, it is better to choose a short term deposit with liquidity. Otherwise, you can lose part or all of the profitability, and even be forced to ask for a loan if the deposit does not allow you to dispose of the money in any of the ways (if not with the cancellation, of course).

4

Search among the different offers that entities have for their deposits and value them. It sounds obvious, but you also have to assess the profitability itself, in addition to the term . Normally, the longer the term, the higher the profitability, although there are exceptions. There are times of the year, such as the end of the year when entities need to close numbers, so their offers to open a deposit tend to be better, as well as the terms of their terms .

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