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A fixed-term deposit (Festgeld) is a bank deposit with a set term and a fixed rate, usually paying more than instant-access savings but locked for the term, and protected up to 100,000 EUR by the statutory deposit guarantee.
A fixed-term deposit, known in German as Festgeld, is a bank deposit placed for an agreed term at a fixed interest rate. The rate is therefore set from the outset and does not change over the term.
Compared with instant-access savings, a fixed-term deposit usually pays a higher rate. The trade-off is reduced flexibility: the balance is generally not available during the term.
Like instant-access savings, fixed-term deposits are protected by the statutory deposit guarantee up to 100,000 EUR per bank and customer. They suit sums that are not expected to be needed over a foreseeable period.
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