Savings and Fixed Deposits , another savings channel that will take you on the path to becoming a millionaire without having to risk too much like investing in stocks. or other forms of investment Let's get to know each type of deposit and check the savings and fixed deposit interest rates for October 2022 of each bank here.
What is a Savings Deposit Account?
savings Suitable for small savings or new salaryman who may start with a small amount of money. Because less money can be deposited It also guarantees that you will definitely receive a return. There is no time limit for the deposit. Can be deposited and withdrawn at any time, thus providing high liquidity It's not difficult in the event of an emergency. and can bring a passbook to guarantee a loan or an overdraft
As for the return or interest of a savings account, interest is charged on a daily basis. But it is usually returned to the account every 6 months or twice a year, paid at the end of June and the end of December each year. Savings interest rates are the lowest compared to deposits in other types of accounts such as fixed deposit accounts.
What is Fixed Deposit Account?
Fixed deposits are suitable for those who have some cold money. This includes people who intend to collect money to buy things or services. This type of deposit will be easier to control the collection. But it may lack flexibility and liquidity. If someone is unable to plan their monthly expenses and expects an emergency payment may be required. including those with unstable regular income must avoid
The account will have a fixed term of deposit, for example 3 months, 6 months, 12 months (not required to deposit every month), and interest is paid once upon maturity and interest earned will be taxed at 15. % (actual interest received will be lower than the bank's announcement) Cannot withdraw early If you want to withdraw, you have to withdraw and close the account and if you withdraw, you will not receive interest. or in the case of early withdrawal but deposited for a long time before the specified time May earn interest on savings interest rates
But the obvious advantage is interest rates that are higher than regular savings and current deposits. It also has lower risks than investing in stocks or funds. and can be used as collateral for the loan In addition, if you deposit a large amount, you may receive the benefits that the bank offers. The benefits received by each bank are different.
Reading up to this point, many people may be worried about the tax withholding as mentioned above. which if you are worried about that In addition to general fixed deposit accounts You may try a tax-free fixed deposit account. Because in addition to not having to be subject to withholding tax of 15%, there is also a special interest rate that is higher than usual. Due to the government's policy to encourage people to save more money.
Comparison of advantages and disadvantages of savings vs. general fixed deposits
1. Savings
| strength | weakness |
| – Small money can be deposited | – The interest rate is considered to be the lowest compared to other types of deposits. |
| – No minimum deposit | – Easy withdraw/withdraw, making it difficult to control money |
| – There is no time limit for depositing money. | |
| - Guaranteed return for sure | |
| - high liquidity because withdraw/withdraw at any time Make it not in trouble if you need emergency money | |
| – Passbooks can be used as collateral for loans or overdrafts |
2. Fixed deposit
| strength | weakness |
| – Get higher interest rates than regular savings and current deposits | – Lack of flexibility and liquidity because it cannot be withdrawn prematurely |
| – Be disciplined and save more money than savings because it cannot be withdrawn immediately | – There is a minimum deposit Some fixed deposit accounts have very high minimums. |
| – Lower risk than investing in stocks or funds | – Withdraw money before the period may not receive interest or receive less interest than the specified period. |
| – If you deposit a large amount, you may receive the benefits that the bank offers. | – general fixed deposit Interest earned will be subject to 15% withholding tax. |
| – Can be used as collateral for loans |
Check the savings and fixed deposit rates of each bank.
Finally, no matter what type of deposit you choose, saving money is a good thing. Take it slow and study the information thoroughly. Don't just choose a higher deposit interest rate. The bank's conditions, convenience and stability should also be considered.
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