Fixed Deposit accounts versus HBD savings - the easy choice!

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Since the banks rarely pay anything (but they ought to) for money deposited in savings accounts, the only choice for many bank account holders to receive rewards of any nature is through fixed deposit accounts.

In fixed deposit accounts, interest is paid for a specified amount of money locked away for a given period of time - usually from 6 months up, but mostly a minimum of 1 year. This type of savings investment is popular among many bank users. But then, with the unlimited opportunities for financial investment opens up in Hive, it becomes pertinent to look at what we had with the banks fixed deposit against what HBD savings offers us.

HBD 20% APR miles better than bank fixed deposits

Here are possible reasons why doing fixed deposit for me is a waste of time...

  • Interest rate: The is the first point of call. People usually want to earn as much passive income as is available. After all, your money should be making more money on autopilot. So what rate does the banks offer for 1 year fixed deposits? Many of my friends I asked, plus my own personal experience shows that it is at most a single digit interest rate. It simply means the interest rate per annum is always equal to or less than 9%. Majority of the banks offer between 4% - 7% per annum. What do you think of that? Lets look at the HBD savings offer.

When you save with HBD, you are paid a whopping 20% per annum. Yes and it is sustainable. So basically, the Hive platform offers at least twice or three times what you have with bank fixed deposit accounts. So based on the interest rate per savings, HBD savings wins the game by a considerable distance.

  • Flexibility: The next thing is how flexible are bank fixed deposits compared to the HBD savings? Well, from the name fixed deposit, you get the idea that you are not going to touch that money for some time - a long time. Most fixed deposit accounts have a minimum of 1 year. So whether there is emergency or not, whether someone died or not, the money in fixed deposits are untouchable for at least 12 months. How about HBD savings?

When you save in HBD savings, your funds are locked away but is very easily accessible within 3.5 days. The is truly a flexible savings structure. So if you had an emergency or something happened that made it necessary to deep hands into your savings, 3.5 days is a reasonably short time to wait to unlock your funds. So which will you prefer? Locking away your money for 1 whole year or having access to them in times of emergency after just 3.5 days? Easy choice for me.

  • Stability of asset: If you leave in a country (like mine) where the economy is unstable, then you have to worry about the value of your assets over time. Inflation in most countries is not just high, but keeps getting higher over a short period of time. For example in Nigeria, the local currency naira exchanges for USD at the rate of 754 to 1. The naira keeps on loosing its value against USD on daily basis. So if I keep money in naira over a long period of time like 1 year, it looses value rapidly.

Looking at our HBD, although it is affected by inflation, it does not loose value the way naira does. HBD is stable, so the price fluctuation is not one that will hurt a large volume of it over a long period of time. Living in a third word country where the economy is depreciating everyday, I rather put my money in HBD savings where it will retain more value over a long period of time, than it would in the local currency.

  • Control: We are all pushing for decentralization. the traditional banking system is 100% centralized. Once your money gets to the bank, the banks controls it. For example, they determine if and when your money is available for withdrawal. For fixed deposit accounts, you relinquish what ever little control you have over your funds for all that period it is fixed. You are not in charge of it. That is why for example, you cannot withdraw or spend it within the agreed period its locked away. That is not so with HBD savings.

You have probably heard the "not your keys, not your money" slogan here on hive. It simply means that you are in full control of your funds here so long as you have your keys. That is also reflected in HB savings. While your funds are "locked away" in savings, you are still in full control of it. You can decide to remove it from savings anytime - and have it back after a very short waiting period of 3.5 days. You are free to remove some or all of the savings. You are free to increase your savings at any point in times.

In essence, you are fully in control of your money in HBD savings. In bank fixed deposits, someone else controls your money.

  • Charges: Another thing to look at is charges. The bank operate fully based on the numerous charges they make on your transactions - sometimes there are uncountable hidden charges too. So within the time of your fixed deposit savings, you will incur a lot of charges. That may include but is not limited to account maintenance charges, ATM charges, withdrawal charges, SMS charges, etc. Over a period of 1 year, that is a lot of money. The blockchain does not operate that way.

HBD savings have zero charges on your savings. There are no maintenance fees or any other fees that will be paid within the period of savings. Better yet, the blockchain has no hidden charges. All transactions are transparent and stored on the blockchain in immutable form. So again here, HBD savings is better than bank fixed deposits.

Conclusion/Your verdict

From the above evaluation, the choice for me between bank fixed deposit and HBD savings is easy - I go for HBD savings anytime any day.

Its left for you now. What is your conclusion. If you are to choose between bank and HBD, what will you choose and why? Share your opinions with me in the comment section of this publication.

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16 comments
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There was a time I went to the back to lock up one small money in the bank like that due to the fear of spending it. I got it after two years. The interest on it was totally abysmal. Inflation ate deep into money and of course, the bureaucracy and time wasting before I got the money was crazy. It's easily HBD for me

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Your experience in fixed deposits is popular. Right now, I am helping a friend to buy 500k worth of HBD which will be put into savings. People are really tired with bank fixed deposits - and everything about banks, but they dont know of any way to use idle money.

I went to the back to lock up one small money in the bank like that due to the fear of spending it

Sorry about the experience. Even in dreamland, I cant imagine you making this mistake again.

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(Edited)

I don't understand how the banks stay in business really. They fuck you every chance they get.. I should go ask for a loan then drop it in HBD saving.. I can probably make their payments with the intrest alone

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I don't understand how the banks stay in business really

They stay in business because the masses have no other option. Majority are ignorant of crypto or Hive. Otherwise, how they operate is sickening.

I should go ask for a loan then do it in HBD saving

Another area the bank is terrible. You dont get a loan if you dont have savings greater than your loan request or if you are not "connected", hahaha.

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Sure, now that our eyes has opened to real business, what are we waiting for.

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HBD savings have zero charges on your savings. There are no maintenance fees or any other fees that will be paid within the period of savings. Better yet, the blockchain has no hidden charges. All transactions are transparent and stored on the blockchain in immutable form. So again here, HBD savings is better than bank fixed deposits

My dear, I rather save in HBD, than fixed deposit in the Bank's. Seriously, had it been I new hive before now, I would have been very happy because I would have saved much if my money here. The flexibility is what I like most. Having full control over my savings

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It doesn't get better than HBD savings. Everything we asked for and more is here. The 3.5 days withdrawal waiting period is the coolest part for me.

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I think you've made amazing points here, having to lock up your cash in the name of fixed deposit, which you can only get after a minimum of one year with little or no interest is actually alarming.

A sensible individual can always make a right choice by locking up in HBD which could be gotten as at when needed and a sure chance of getting a 20% annual increment

That's really outstanding, isn't it?

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I believe it is. I wish everyone will see this post and make the wise decision of saving in HDB. Thats the best and most sensible thing to do

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You know information is power, we on hive still have great work to do. To educate people on finance. Just few have this knowledge of depositing on stable coin especially HBD. The rest is bank and goods.

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Interesting write-up and easy to understand. There are too many charges on our local bank account. Thank you so much for for throwing more light on Bank fixed deposit compared to HBD. I know there's a HIVE and DOLLARS in HBD but the B got me guessing. What is HBD? For me I stand firmly with HBD anytime, any day.

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I will always choose hbd over bank savings anytime any day ,the most annoying things about the traditional baking is,tradition banking will charges fees in deposits when actually you are using my money for inter bank trading

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I agreed with you, fixing money six or one year above at bank, it's wasting investment. But holding HBD, stable coins and etc, was a greater Gain. Nice post keep it up.

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