Dear readers, I hold a certain percentage of my financial portfolio in fixed deposits.
My holdings in Fixed Deposits has really been before fixed deposit rates here have become more attractive due to the higher interest rates.
I really treat my fixed deposits as Savings at a much higher interest rates, as compared to the more modest rates from the banks. For why not deposit your excess monies or savings in fixed deposits, earning much more interests than from the banks.
Of course, there is the holding period to consider for an early withdrawal for many fixed deposits may mean a penalty fee.
Recently, I was in a bank to redraw my fixed deposit and to have it placed in a new fixed deposit offered by the bank at a much higher interest. I arrived at around 11 am on a Saturday, one hour before the bank closes. But I was actually surprised to see a number of people in the queue inside the bank as well. From what I observed, quite a number of them were also asking about the bank’s newest fixed deposit with the good interest rates.
I spent, in all, an hour in the bank and this compared with just 15 minutes when I renewed my fixed deposit last year at a more humble interest rates.
Notwithstanding fixed deposits are decent tools to grow your savings generally risk-free, do be prudent enough not to put so much of your liquidity to these fixed deposits, only to find yourselves locked out of opportunities when the times come to invest in the stock markets when attractive opportunities present themselves to you.