The fixed-term deposit is a savings account on which the funds are blocked for a certain time, or "term". This is generally a short period: a week, a month, a quarter, half a year, a year or even more.
Unlike savings books, a term account gives you a guaranteed interest rate for the entire term of the investment. The longer the term and greater the amount invested, the more attractive the interest rate shall be. The rate depends on market interest levels and so is often subject to fluctuations.
Deposits are held to maturity and there is no secondary market. In principle, the interest is paid on maturity.
Once the interest rate is set, you are assured a guaranteed return, even if market interest rates change unfavourably.
Apart from the flexibility offered in the term, you have the ability to negotiate repayment of your fixed-term deposit prior to maturity at any time. Luxembourg ING then sets the redemption price in accordance with the expenses linked to this early termination.
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