Many people are hesitant to go to the bank to make a deposit, not knowing whether to choose a one-year or three-year term. Generally speaking, the longer the deposit period, the higher the interest, so some people may think that more people save for five years. But in fact, far as many people choose a five-year term as there are those who choose a one-year or three-year term.
The reason for this is very simple, the five-year period is too long, a full five years, how many five years can there be in life? So in a comprehensive comparison, saving for one or three years is more beneficial and more worthwhile. So, should we choose a one-year term or a three-year term?
At present, the interest rate on one-year deposits in state-owned banks is about 1.45%, and the interest rate on three-year deposits is about 1.95%. This means that if the same amount is deposited for different tenors, the interest will be very different.
For example, if you deposit 50,000 yuan, the interest you will get after one year is 725 yuan and 975 yuan respectively. From this amount, a three-year term is more cost-effective than a one-year term, and the more principal, the greater the interest gap received.
If the principal is 500,000 yuan, then the interest will be 7,250 yuan and 9,750 yuan respectively, and the difference in one year will reach 2,500 yuan. Compared with the sum of the three-year period and the three one-year periods, the gap is as high as 7,500 yuan. As can be seen from this data, it is significantly more cost-effective to choose a three-year term. But this is only a theoretical value, and there are many other factors that need to be considered in real life.
For example, if you choose a three-year deposit, you need to save the money for three years before you can receive the corresponding interest. In case of early withdrawal, interest will be calculated at the current interest rate. In other words, early withdrawals will result in a significant loss of interest.
In addition, three years is a long time, and there may be unexpected situations during the deposit period that require the use of money, which will have to bear a higher liquidity risk.
If you choose a one-year time deposit, although the interest rate is slightly lower, the time is more flexible, and the interest can be paid quickly. At the same time, the time period of one year is shorter, so you can basically predict in advance whether you need to use money, and it is not easy to lose interest.
So is it better to choose a one-year term or a three-year term? For the elderly, who usually live frugally, do not have too many large expenditures, and have been idle for a long time, and want to get higher interest, they can consider choosing a three-year deposit. For young people, the cost is large, there are many variables, and the money in hand is idle for a short period of time, so you can choose a one-year period to make the funds more flexible.
Overall, whether you choose a one-year or three-year term, there are advantages and disadvantages to it. When depositing, we must choose the deposit method that suits us according to our specific situation.