“Leave your money!”: 4 situations when you should not take a deposit from the bank

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The money on the deposit does not belong to the bank – the client places them at interest and has the right to withdraw the entire amount at any time. True, for term deposits this will lead to a loss of income – banks usually reduce the rate to the lowest possible upon early termination, but at least the depositor gets what he placed on the account. At the same time, there are situations in which it is worthwhile to postpone the termination of the contract. Experts of the financial portal Smartzaim.kz spoke about them.

Increase in the base rate

The base rate is determined by the National Bank. In crisis situations, it is usually increased to contain rising inflation, and when the situation stabilizes – lowered. A lot depends on this parameter. First of all, the base rate determines the value of the national currency and leads to a decrease or increase in rates for bank products – deposits and loans.

At this rate, second-tier banks take loans from the National Bank to give money to the population. Accordingly, the higher the percentage of the National Bank will lend to commercial banks, the “more expensive” loans will cost customers, but the greater the income will be on deposits.

By the way, it should be taken into account that usually the rates increase after the base one only for tenge deposits, and for currency deposits they often fluctuate in a small range.

What to do? When the base rate rises, deposit rates invariably rise. At this point, you should not close your account. But if the deposit has been open for a long time, and the rate on it is lower, then it makes sense to transfer money to another account at more favorable interest rates. You can benefit from the growth of the base rate – if the deposit is opened at the peak of its value, and in the event that it drops again, the bank will not be able to unilaterally reduce the rate, and the depositor will receive the maximum income.

Improvement of deposit conditions

The bank is not entitled to change the interest rate unilaterally, but with other terms of the deposit agreement, everything is different. For example, a bank may offer a client the addition of certain options:

– set the possibility of partial withdrawal or replenishment;
– define a certain period of time upon reaching which the rate is “frozen”, and in case of early withdrawal, the depositor will not lose all income;
– allow the use of interest capitalization, which also increases the profitability of the deposit.

What to do? If, for example, you decide to withdraw a deposit due to the fact that it does not have options for partial withdrawal or replenishment of the account, check with the bank whether it is possible to change the terms of the agreement while maintaining the interest rate. Usually, banks are reluctant to do such manipulations (especially if the rate on the current deposit is higher than those currently in effect), but in order not to lose customers, they can theoretically agree.

Inflation growth

The main task of deposits – save and increase funds. Of course, you won’t be able to earn a lot on them – in most cases, the rate of inflation overtakes the rates on bank deposits. But it is quite possible to protect money from depreciation with the help of such a tool. And it also allows you to collect the required amount and not borrow money – for example, a short-term loan or a bank loan.

If the base rate remains at the same level, and the growth of inflation is obvious and fast, empty the accounts – not the best idea. The exception is when you want to spend the entire amount at once, for example, to buy an apartment or a car.

If you are withdrawing money from a deposit only to hide it under your pillow for a long time, keep in mind that with high inflation, it will depreciate very soon.

What to do? rising inflation and rising prices, protect your savings as much as possible. One of the most transparent, safe and understandable ways to do this – bank deposit. If you are not ready to invest in more volatile assets and do not want the money to depreciate, leave it in the deposit.

Investments and trading on the stock exchange

The main difference between these instruments is that deposits give a low income, but are guaranteed, while investments, for example, in shares or cryptocurrency, – potentially high profit, but not guaranteed. Most experts advise separating savings and keeping at least some of it, about 15–20%, in a bank.

So if you want to withdraw everything from your accounts and go into, for example, trading stocks or investing in cryptocurrency, decide are you ready to lose that money. Do not forget about the guarantee reimbursement of deposits – KDIF for most types of deposits will return the money to the depositor, even if the bank's license is revoked. No one will return the savings used for investments.

What to do? Do not take everything from the deposit if you are not sure that you can safely and profitably invest money. Experienced investors advise first to create a financial cushion – it may well be a bank deposit.

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