talletustodistus

Talletustodistus, known in English as a certificate of deposit (CD), is a savings product offered by banks and credit unions. It is a time deposit with a fixed maturity date and a fixed interest rate. The depositor agrees to leave the money in the account for a specified period, typically ranging from a few months to several years, in exchange for a higher interest rate than that offered on regular savings accounts.

When a talletustodistus matures, the depositor can withdraw the principal amount along with the accrued interest. Early withdrawal of funds before the maturity date usually incurs a penalty, which can reduce or eliminate the earned interest. The interest rate on a talletustodistus is often determined by market conditions and the length of the term. Longer terms generally offer higher interest rates.

Talletustodistukset are considered a low-risk investment because they are typically insured by deposit insurance schemes, such as the Finnish Deposit Guarantee Fund (Talletussuojarahasto) up to a certain limit. This insurance protects the depositor's money in case of the bank's insolvency. They are a popular choice for individuals seeking a safe place to store savings while earning a predictable return. The principal amount is guaranteed, making them suitable for risk-averse investors.