FestzinsSparen

What is Deutsche Bank FestzinsSparen?

According to the provider, Deutsche Bank's FestzinsSparen is officially a savings deposit rather than a classic term deposit or fixed-term account in the strict sense – but for savers, it functions like a fixed-term account paying a fixed rate over an agreed term. The investment runs free of charge through the customer's existing Deutsche Bank account; no additional reference account at another bank is required.

Interest Rate and Terms

For new deposits, Deutsche Bank currently pays 2.70% p.a. for a 12-month term, applying to deposit amounts between EUR 2,500 and EUR 250,000. The rate is fixed and guaranteed for the agreed term. Anyone renewing an existing FestzinsSparen balance instead of investing fresh money, however, receives noticeably less: 2.30% p.a. for terms of 6 months to 3 years, and 2.40% p.a. for terms of 4 to 8 years. That leaves a meaningful gap of 0.40 percentage points between new deposits and renewals of existing balances – a very similar new-versus-existing-customer gap shows up in comparable offers from other large banks, such as Postbank's Zinssparen.

Terms and Special Features

According to Deutsche Bank, investing in FestzinsSparen is free of charge. If the deposit is not cancelled at the end of the fixed term, it is automatically reinvested – but at the rate applicable at that time, which need not match the original new-deposit rate and is therefore not guaranteed. Customers wishing to cancel must give at least three months' notice before the end of the fixed-rate period. No reference account at another bank is required.

Who Is It For?

The offer suits Deutsche Bank customers best who want to invest fresh money for a year at a fixed rate with no market risk, and who can secure the more attractive 2.70% p.a. new-deposit rate. Anyone simply rolling over an existing FestzinsSparen balance should factor in the lower renewal rate of 2.30% to 2.40% p.a. and check well before the notice period expires whether a fresh deposit or a switch to another provider is worthwhile.

Worked Example

On a new deposit of EUR 10,000 over 12 months, the 2.70% p.a. rate works out to roughly EUR 270 in interest before tax. Renewing an existing balance at the lower 2.30% p.a. rate would earn only about EUR 230 on the same amount.

Verdict

At 2.70% p.a. for 12 months on new deposits between EUR 2,500 and EUR 250,000, Deutsche Bank's FestzinsSparen sits at a competitive level in the current market – free of charge, guaranteed, and with no separate account needed elsewhere. The key point to watch is the three-month notice period: anyone who misses it is automatically rolled over into a reinvestment at a non-guaranteed rate that, historically, has been noticeably lower for existing customers.