Most of the peoples are still putting their savings under fixed deposit. Normally, the fixed deposits have a duration time of five years. It provides various types of benefit to the customers. However, this has got some disadvantages under certain circumstances. The money that is deposited under fixed deposit cannot be withdrawn until the duration is completed that is the fund cannot be used for the emergency purpose. Although if spoken in precise sense, it can be done but then certain percentage of your interest will be deducted by the authority.
Besides that, Individuals open current deposit accounts in the banks to have the liquid cash in their hand. The main motive behind the opening of the current account is to get interest on deposit as it happens in the case of the savings deposit and term deposit but it helps to avoid from the direct handling of the cash, maintaining of the accounts, certification of balances. The interest rates under current deposit accounts are very low. People generally keep their money under this account to meet their daily requirement.
The saving deposit are opened for the client by issuing a savings book to the client or a similar type of document which contains the similar thing. The client can deposit and withdraw money at any time. Though the savings deposit are very similar to the current deposit but there is a big difference between them. When the depositor withdraws the money from the savings deposit account he/she has to show a valid reason for its withdrawal but in a current deposit the depositor can withdraw the money at any time. That is why the interest rates in the saving account is usually more than the current deposit.
Thus, we see that all the types of deposit are very important and it depends upon person to person.
If you are looking for better return and at the same time getting bonus for every year, I would like to suggest you to go into Insurance Saving Plan, because the Saving Plan that Prudential is offering requires you to save a minimum of RM 4,551 per annum, which can be saved annually, half yearly, quarterly or monthly, for only 5 years. The policy will run for the next 30 years.
For example, if you were to save RM 4,551 a year for 5 years. It will sum up to RM 45,510.00. At the end of the 30th year (maturity), you would have RM 103,445.00(Bonus is included). This is double of the amount saved. Yearly Bonus is guaranteed as well.
However, if you do need more advice or questions, feel free to email me, or even SMS me at +6 012 827 9991. No obligations whatsoever of course. Its just for your knowledge of whats in the market.
Why saving plan is better than fixed deposit?
Firstly, the returns for Fixed Deposit are less compared to savings plan.
Secondly, savings plan comes with some protection. Although minimal, but it still is there.
Thirdly, it’s like a forced savings.