A savings account that pays a higher interest rate than a traditional account, and there is a time requirement on how long the money must be kept in the account is called:

BANKING GENERAL KNOWLEDGE

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	Certificate of Deposit
B	Custodial Account
C	Stock

Explanation:

Detailed explanation-1: -Therefore, money is deposited in a fixed deposit account to earn interest at a higher rate. This type of deposit account allows the deposit to be made of an amount for a specified period. This period of deposit may range from 15 days to three years or more during which no withdrawal is allowed.

Detailed explanation-2: -CDs often have higher interest rates than traditional savings accounts because the money you deposit is tied up for the term of the CD. Be sure you will not need the funds before the end of the CD term, as early withdrawals may have financial penalties.

Detailed explanation-3: -A CD is a type of savings account with a fixed time period and interest rate. CDs tend to have higher rates than regular savings accounts but don’t allow easy access to your money until a term ends.

Detailed explanation-4: -Fixed Deposits (FD) offers the highest rate of interest, ranging from 4 to 7.25 percent.

Detailed explanation-5: -The Post Office Time Deposit Scheme guarantees a return on investment. Section 80C of the Income Tax Act allows for a tax deduction on 5-year time deposits. Even minors above the age of ten can manage their own accounts. There is a nomination option available.

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