🎯 Goal: Understand how term deposits and interest rates work.
You understand a term deposit (3/6/12 months) usually pays more than no-term, in exchange for not withdrawing early; good for the emergency fund and near goals.
Let’s explore
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A term deposit (3, 6, 12 months) usually pays a higher rate than a no-term deposit.
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In return, you commit not to withdraw early; early withdrawal usually cuts interest.
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It is a safe channel, good for the emergency fund and near-term goals.
Practice activity
🤔 When should you choose a long term, and when keep money flexible? Reason it out.
Worked example: You have 5 million you definitely will not use for a year → a 12-month term for higher interest. Another 1 million might be needed suddenly → keep it no-term for flexibility, withdraw anytime.
Quick quiz
1. A term deposit usually?
→ Pays higher than no-term
2. Withdrawing early usually?
→ Cuts interest
3. Savings is suitable for?
→ Emergency fund, near-term goals
4. A 12-month term deposit vs no-term?
→ Higher interest
5. Money you might need suddenly should be?
→ No-term for flexibility
🎯 Real-life mission
Compare the interest rates of two different savings terms.