Core Viewpoint - The article discusses the advantages and disadvantages of fixed-term bank deposits, highlighting their safety and stability compared to other investment options, while also addressing the impact of interest rates and taxes on returns [1][3][5]. Group 1: Fixed-Term Deposits - Fixed-term deposits offer a secure investment option, with a three-year deposit of 100,000 yielding 3,750 in interest, equating to an annual interest rate of approximately 1.25% [1][3]. - The interest calculation is straightforward: principal × interest rate × term, which ensures predictability in returns [3]. - Fixed-term deposits are particularly suitable for conservative investors who prefer stability over higher-risk investments [1][7]. Group 2: Comparison with Other Investment Options - Other investment vehicles such as funds, stocks, and bonds may offer higher returns but come with increased risk, making fixed-term deposits a safer choice during economic fluctuations [5][7]. - For instance, a conservative fund investment could yield around 5% over three years, but it also carries the risk of loss [5]. - The choice between fixed-term deposits and other investments should align with individual risk tolerance and liquidity needs [5][7]. Group 3: Early Withdrawal Considerations - Early withdrawal from fixed-term deposits typically results in interest being paid at the lower current account rate, significantly reducing returns [5]. - For example, withdrawing a three-year deposit after one year may yield less than 500 in interest, which is often lower than what would be earned in a regular savings account [5]. - Proper planning regarding the usage of funds is essential to avoid the need for early withdrawal [5].

Core Viewpoint - The Ministry of Finance and the State Taxation Administration announced that starting from August 8, 2025, interest income from newly issued government bonds, local bonds, and financial bonds will be subject to value-added tax, impacting the financial market significantly [1][3]. Group 1: Impact on Financial Products - The new tax policy will affect various financial products, including bank wealth management products, fixed-term deposits, and money market funds, as these are closely linked to the bond market [1][3]. - The average annualized return on bank wealth management products is currently 2.12%, which may drop below 2% due to the new tax, making them less attractive to consumers [3][10]. - As of June 2023, the total scale of bank wealth management reached 30.67 trillion, with a significant portion invested in bonds, indicating a large potential impact on the financial sector [1][3]. Group 2: Economic Implications - The government aims to stimulate consumption and investment by discouraging savings in banks, as the current economic environment shows a strong deflationary trend with citizens preferring to save rather than spend [5][10]. - The total household savings reached 162.9 trillion by the end of June 2023, with a monthly increase of 2.5 trillion in June alone, highlighting the need for policies to encourage spending [3][5]. - The potential introduction of taxes on bond trading profits and personal income tax on deposit interest could further influence consumer behavior and investment strategies [7][8]. Group 3: Historical Context and Future Outlook - The current situation mirrors the post-Asian financial crisis period (1998-2008) when interest tax was implemented to encourage spending, suggesting a historical pattern in government responses to economic challenges [10][18]. - The new tax policy may serve as a turning point for the stock and real estate markets, as funds are likely to shift from the bond market to these sectors, which have been underperforming [10][18]. - There is skepticism about whether consumers will respond positively to these changes, given the current economic climate characterized by layoffs and salary reductions [13][17].