First of all, you need to understand what goals a person who opens a contribution faces. And also how much he has, says Sergey Kokotov, project manager of Orange Bank.
If this is a banal desire to find the largest percentage in the market, it is better to invest in securities with an adequate manager, since earnings there will be higher with comparable levels of risk. And if it is the creation of a reserve fund or the preservation of capital for retirement, then here the bank must be reliable and at least protect funds from inflation. Below we have voiced several basic questions and answers on the topic of how to make a bank deposit correctly.
How to choose the right bank, and what should be suspicious?
The choice of the bank is an analysis of its current situation in the market, as well as compliance with the goals and objectives of the depositor.
• The bank must have a banking license.
• Information about the bank must be posted on the website of the Central Bank so that it can be verified.
• It is good if the bank has a rating assigned by a specialized rating agency, and not reviews and the so-called “people’s rating”. This is not an indicator..
• The bank should be included in the deposit insurance system (information on this should be available).
It is worth checking the composition of the owners of the bank and looking for information about them. Suspicion may be caused by owners of foreign origin, convicted or persons involved in complex lawsuits. It depends on the owner what kind of policy the bank pursues, so it is important that he has a good background.
It is worth paying attention to the presence of electronic document management methods (Internet banking, mobile application), as well as the level of service in the departments. Not every bank can boast of the absence of queues and a comfortable, “sincere” atmosphere. These basic safety rules will help you understand how to make a bank deposit and not make a mistake in choosing.
Contribute to one bank or several?
Abroad, the practice of deposit insurance is not common. According to statistics, people keep no more than 10% of assets in deposits: it is convenient, there is quick access to money, but income barely covers inflation. In our country, the situation is different: people place most of the capital in the deposits of several banks, look for where the rate is higher, shift from one deposit to another, fuss. This is due to the low financial literacy of the population. Often vanity and the pursuit of profit do not bring results, because tools that are not adequate for the situation are used.
It is better to use one bank that is reliable for the client, with the most convenient access to money (including via the Internet and mobile bank). The remaining money is worth investing in other tools: securities, real estate, business or art. The principle of diversification is important, i.e. distribution of funds for various assets. No matter how you like banks, the monotonous approach does not satisfy the security principles of asset allocation.
Increase financial literacy and banks in general may no longer be interesting in terms of storing funds that you do not use. Therefore, the question of how to make a bank deposit will disappear by itself.
From what amount it makes sense to make a contribution?
The bank can store any amount. But you need to understand the goals that the client pursues. The basic foundation of financial literacy is to have an amount equal to 6-month spending. Not a salary for 6 months, namely a waste. Because some people spend less than they earn. It is believed that this amount of capital will allow, without changing the standard of living, finding a new job, in which case. After all, when it is lost, most of us are forced to continue to support ourselves and pay current expenses and loans.
At the same time, it is necessary to start forming such a reserve with small amounts, gradually, over several months (or years). But it’s better not to stretch, because life is unpredictable. Do not think that a small income is an obstacle to the formation of a reserve. This is a misconception that you need to get a lot first, and then just start putting it off. You need to start with small amounts (as a workout and develop a habit) and then with large amounts it will be easier.
How long to give money to the bank?
The term of the deposit matters only in comparison with the rate. If the client only needs to overexpose the money before buying a property, it is worth opening a short deposit. But if the client is aimed at earning money – there is nothing wrong with the long run. Here the percentage of the rate itself and the availability of withdrawal / replenishment opportunities are more important.
If you are ready to put money into work for a longer time at an increased rate – please. But if you intend to use the money you deposit, then it’s rather important not the term, but the withdrawal and replenishment of funds without a commission. Of course, the rate on such deposits is lower. Therefore, everyone should understand their goals and objectives before making a bank deposit.
What interest rate is reasonable?
Interest rate – variable. It does not depend on the desire of a particular bank, but on very many factors. First of all, from the key rate of the Central Bank and the situation in the banking services market. Naturally, you need to understand what the key rate is and also what is the average market rate. If the deposit rate noticeably exceeds the average market indicators – this is a signal to a more cautious attitude, since the bank may experience certain difficulties.
At the same time, it often happens that banks offer a rather high rate for existing customers or for those who are about to end their deposit. This is a normal situation: in this way, it keeps investors, which is much more profitable than attracting new ones. Therefore, it makes sense to compare the conditions for deposits for those who first open a deposit in the bank and for those who are already a client. Suspicion should be caused by just high rates for new customers, and not for existing ones..
In conclusion, I note that the banking system in the Russian Federation is currently changing. The number of banks is reduced (from more than 800 to less than 500 in 5 years), the requirements of the Central Bank to existing banks are being tightened. This leads to the formation of a better banking sector. At the same time, before making a bank deposit, it is worthwhile to understand that a bank is only one of the tools for saving funds. And do not think that the funds invested in several banks with DIA insurance are fully protected. DIA has borrowed money from the Central Bank more than once, since the volume of payments to depositors of closed banks is very large. Is it possible that at the closure of another banking organization, the DIA simply does not have enough money to compensate for the loss to all individuals?
You can trust banks if you understand the nuances, but trust all the money is not worth it. Improve financial literacy, learn about alternative investment instruments and distribute assets among them, including a bank.
What risks exist when opening a deposit?
Given the fact that the limit of insurance of the Deposit Insurance Agency (DIA) is now 1.4 million rubles. for one depositor in one bank, the “do not exceed” strategy is the most robust one before making a bank deposit, says Natalia Yasheva, head of the FORA-BANK branch in St. Petersburg.
This implies that a depositor in one bank should open a deposit (or deposits), the total amount of which, with interest at the end date, will not exceed 1.4 million rubles. Moreover, the number of banks in which a cautious investor can place their funds is not limited. In the event of an insured event in one of the banks, funds in accordance with the law will be paid out within 2 weeks from the date of withdrawal of the license through one of the agent banks designated by the Central Bank.
The most significant risk that a depositor may face in the framework of the “do not exceed” strategy is the so-called “notebook” deposits, when the funds are accepted by the bank, but, in violation of the law, are not reflected on the balance sheet. To create the appearance of the depositor that the bank has made the deposit properly, all the necessary documents are drawn up. Unfortunately, this type of fraud on the part of banks was quite widespread in 2014-2016 among banks – “vacuum cleaners” and has been practically eliminated by now by the regulator (CBR).
Nevertheless, it is recommended to keep all documents provided by the bank when opening a deposit – since then they will be evidence that the deposit was actually made and the depositor has the right to demand it.
In most cases, these documents are enough for the deposit record to be restored and the money paid to the depositor. In this case, the DIA understands the fraudulent actions of the bank, without involving the client in a lawsuit.
What strategies can be applied when investing in a bank?
Obviously, when planning the placement of a deposit, the investor wants to get the maximum benefit in the form of interest. However, when choosing the type of deposit, one should pay attention not only to the interest rate, but also to other essential conditions: regularity of interest accrual, the possibility of early termination without loss of interest accrued during the period of deposit, the possibility of adding and partial withdrawal of the deposit and / or accrued interest. If the depositor is not sure that the amount will not be needed before the deposit term expires, it is better to agree to a lower interest rate, but with the possibility of early termination.
It is no secret that deposit rates have been declining for a long time. In order to “fix” a rate of interest, for example, on a share contribution with the possibility of adding funds, you can open this deposit for the minimum amount, and pay the main amount of the deposit when you have available funds.
For example, if you understand that after six months you’re ending a deposit in another bank, and by the time it ends, the rate on it will be lower than now, then you can open a new deposit on the promotional offer for the minimum amount and fix the rate, and then transfer funds from old deposit to new.
And a little more about the risks
When choosing a bank, each depositor has his own priorities: interest rate, popularity of the bank, having an office near the house, remote access, additional bonuses from the bank when opening a deposit (for example, free additional banking services and / or gifts), etc. If you comply with the DIA insurance limit, you can choose a bank according to any of these criteria – taking into account the foregoing, all of them will be sufficiently protected and safe from the point of view of repayment of funds.
However, before making a bank deposit, you need to make sure that you are making a deposit in the bank. Unfortunately, now many financial organizations are trying to disguise themselves as a bank, and banks are trying to disguise other financial services, for example, investing under the guise of a deposit. It must be clearly understood that the state represented by the DIA insures and guarantees repayment only on bank deposits, and the placement of funds in any other financial instruments is carried out at the risk and risk of the depositor.
The Central Bank of the Russian Federation now has a rather tough position on controlling deposit rates, and the interest rates of all banks are in approximately the same range. And if you saw an advertisement for a “deposit” with radically different rates, it is very likely that we are talking about other financial instruments that, along with higher returns, also involve incomparably higher risks for an investor-investor. And the state will no longer take on these risks. Money management requires a responsible attitude and care, therefore, before making a bank deposit, we recommend that you carefully study the issue.
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Before making a bank deposit, it is crucial to gather essential information. How can I ensure the safety of my deposit? Are there any minimum deposit requirements? What are the interest rates? Can I easily access my funds when needed? Are there any fees or charges associated with the deposit? And lastly, what documents or identification do I need to provide? Please clarify these aspects for a smooth banking experience.
What are the key factors to keep in mind before making a bank deposit? Are there specific requirements or documents needed? How can one ensure the safety and security of their deposit? Can you explain the process and any potential fees involved? Any tips for maximizing the benefits and minimizing any risks associated with bank deposits?