How Fixed Term Deposit Accounts Work

Understanding how to make the most of your savings is a vital part of managing your personal finances. One of the ways to grow your money safely is through a fixed term deposit account.

This article will explain the fundamentals of fixed term deposit accounts, including how they function, their benefits, and considerations for choosing the right fixed term deposit for your financial goals. Additionally, we’ll look at the interest rates for APS Bank’s fixed term deposits and introduce the APS Green Term Deposit, a sustainable investment option. Let’s dive right in!

What is a Fixed Term Deposit Account?

A fixed term deposit account is a financial product where you deposit a lump sum of money for a set period of time at a fixed interest rate. During this time, your funds are locked in and cannot be withdrawn. The key benefit of a fixed term deposit is that it typically offers a higher interest rate compared to regular savings accounts, as the bank can use your money for longer-term investments.

The APS Fixed Term Deposit account offer simple terms that strike a good balance between interest rate and duration, allowing you to diversify your savings portfolio and earn some extra return.

The Benefits of a Fixed Term Deposit Account

• Higher Interest Rates: fixed term deposits usually offer higher interest rates compared to regular savings accounts, making them an attractive option for savers looking to grow their funds over a specific period.
• Predictable Returns: with a fixed interest rate, you know exactly how much interest you will earn by the end of the term, which can help with financial planning.
• Safety: fixed term deposits are generally considered low-risk investments, especially when compared to stocks or mutual funds. Your principal amount is secure and not subject to market changes.
• Flexible Terms: APS Bank offers fixed term deposits with different durations, allowing you to choose a term that best aligns with your financial goals.
• Diverse Currencies: APS Fixed Term Deposit Accounts are available in multiple currencies, providing options for those with specific currency needs or who want to diversify their currency exposure.
• Interest Payment Options: interest can be added to your capital or credited to your savings or current account, with payment frequencies that include monthly, quarterly, semi-annually, annually, or at maturity.

Fixed Term Deposit Interest Rates

Interest rates for fixed term deposits depend on the amount deposited and the length of the term. For APS Bank, the interest rates are quite competitive, as shown in the table provided:

For deposits of €500,000 or more, it is recommended to contact our Treasury team for specific rates and terms. The minimum amount to open an APS Fixed Term Deposit account is €1,000, and interest rates are subject to change without prior notice.

How to Choose the Right Fixed Term Deposit for Your Financial Goals

Selecting the appropriate fixed term deposit requires careful consideration of your financial objectives, liquidity needs, and risk tolerance. Here are some factors to help you choose the right fixed term deposit:

• Investment Horizon: decide how long you can commit your funds without needing access to them. Shorter terms offer more flexibility, while longer terms usually offer higher interest rates.
• Interest Rates: compare the interest rates offered for different terms. Higher rates typically come with longer commitments.
• Liquidity Needs: consider if you might need access to your funds before the term ends, a shorter-term deposit might be more suitable.
• Financial Goals: align your fixed term deposit choice with your financial goals. For long-term savings goals, a longer-term deposit might be ideal. For short-term goals, a shorter term might be more appropriate.
• Interest Payment Frequency: decide how often you want to receive payments depending on your cash flow needs.

The APS Green Term Deposit: Saving with Purpose

The APS Green Term Deposit is a unique and sustainable investment option, being the first of its kind locally. When placing your money in a green term deposit, you are not only earning a return but also contributing to the funding of local projects that qualify for green lending. These projects typically focus on environmental sustainability, such as renewable energy, energy efficiency, and other green initiatives. The APS Green Term Deposit is an excellent choice for those who want to make a positive impact with their savings.

Get Started with APS Bank

Opening a fixed term deposit account with APS Bank is an easy process. This can be done online (if already an APS customer) or by making an appointment at one of our branches.

For detailed information on how to open an APS Fixed Term Deposit account, click here. For more information on interest rates and to discuss the best fixed term deposit option for your financial goals, you can reach out to our team by filling in the form below.  Start your journey towards achieving your financial goals today with APS Bank.

Approved and issued by APS Bank plc, APS Centre, Tower Street, B’Kara BKR 4012. APS Bank plc is regulated by the Malta Financial Services Authority as a Credit Institution under the Banking Act 1994 and to carry out Investment Services activities under the Investment Services Act 1994. Terms and conditions apply and are available on Terms and Conditions – APS Bank.
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