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How does Term Deposit Work

What are the factors paramount when you are planning your investments? Are you saving in order to buy gold jewelry or upgrade your car to a more spacious and luxurious option? Are you planning for your child's higher education? But one of the best things about the times that we live in today is the availability of comprehensive investment tools so as to grow our wealth and have a secure post-retirement life. When it comes to investments, the adage 'It is never too late' holds true. Depending right on what your needs are, you will certainly be able to find a scheme that will help your plans to fruition.



If you are thinking of short-term investments to achieve immediate goals, we suggest term deposits for higher returns. This article will get you acquainted with term deposits and their benefits. Also, check this link for some additional details about short-term investment plans!

What is a Term Deposit?

Term deposit is one of the investment tools you can effectively use to achieve short-term goals. What this scheme does is that it locks your money at a preset rate of interest over a fixed tenor. And thanks to the various benefits, term deposits are one of the most popular investment options. The approximate tenor of these term deposits range from 7 days/15 days to 10 years.

When you hold your money with the bank, assume for a tenor of 5 years, the bank will use this money to lend to other borrowers and earn interest off it. By the time your term deposit matures, the bank will provide you with some part in the share of the money it earned.

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