Both are interest bearing financial assets. However note this

TB is government backed while FD is not

TB is tax exempt while FD is not

TB is issued at a discounted rate and redeemed at par while FD can be issued with interest paid back end or upfront.

Both can be liquidated prematurely however at a cost.

The minimum tenor for TB is 91 days and max of 365 while FD is usually monthly (30days) up to 365 days. Also there are some FD on call

As per interest rates, up until now TB had higher rates than FD however rate is not the best criteria to distinguish between both as this is more of operational meaning rates can oscillate both ways for the two financial instruments.

For those looking to build long term wealth. I advise you have a portfolio with varying asset classes to hedge for risk. Ie cash, FD/TD equity and other classes of assets they deem fit.


Funny thing is people always avoid the equity market like it's a plague but know this in any economy there will always be a boom and bust. Oil prices will always go up and down same for dollar. This is what capitalism is all about.

When the naira really down against the dollar I told people that this was the right time to buy naira assets but they refused and some converted their assets to dollars. Some even put money in al sorts of ponzi schemes and got their fingers burnt.

Now for those that study the market well. Compare the prices of the following stocks in Jan 2017 and now Fidelity, Dangote sugar dangote cement stanbic Zenith fbn uba access dangote flour and ROI that a 1m investment will have made in 12months both in capital appreciation and dividend payments


The bitter truth is only long term investors make money ask Warren buffet and study his investment philosophy. On the other hand Nigerian are always looking for the quick way out.

Beress:

Based on this, it means N1m TB will give u N480k in one year... I think is cool sha

It is not calculated that way. That 12% is per annum and which will give you about 120k for a year and 30k for 90 days for N1m.

id2011:
What is the diffrence btw treasury bill buying and fixed money in account, pls becos i have a brother that want to go it. which one it's ok to invest on

Bro bank would collect all those many charges.. By the time u know u have only 5-6 % as interest..
Insurance doesn't take any charges.. Fixed deposits interest we give up to 10% at aiico insurance.. Very very good if u ask me.. Plus within the 1 year or years depends on how long u want to keep the money. The person has a death cover of 1m plus the money her deposited

Doerstech:


Which is better?

Invest in crypto

arrestdarrester:


Be wary of bitcoin

Could you please tell me why?

kingpole:
No, I haven't.
Have you ever been in the transport business? That's just investing in an asset that loses value with every mile your driver takes.
While land investment maybe be a good way to get an appreciative asset (yes, I've got a few) it takes many years for your investment to break even. Land investment is like a retirement plan.

I have done both...

Land do take time to appreciate but it's the safest for me.

Been into transport shaaa..
A cousin bought a truck (tipper) for 3.5m (2016), he traveled back abroad so I was looking after the teuck...

The first driver messed the truck up cuz he was related to us ( wasn't doing account weekly which is 60k dry season 45k to 50k raining season). After some months I returned the truck home then started consultation.

After all set and done, I took 400k and returned the truck better than it was when they bought it...

Then I put it up for higher purchase... I told our priest( catholic) and he also made the announcement in church service..

It took small time shaaa but I finally got a serious man.. he made deposit of 500k before he took the truck and is returning 62500 weekly... sometimes he do return double of the money in a week so we just do check and balance...

As I'm talking to you now, his conductor is begging secretly to couple a sound truck for him...
That he's ready for my terms and conditions...

You might not like the biz style but it's ok for me.

Banks will tell yo they want to bid for the TB , that you should deposit money in an account wich you can't withdraw again, once they are done with the biding of what ever they are bidding the money dsiappears.. and u will be making peanuts as gain

XXLDICK:
Treasury bills are loans sold by FG and usually have higher interest rates compared to fixed deposits


Fixed deposit on the other is a form of savings with some kind of restrictions and yields interest

For treasury bills, you have no access to your money until it's duration elapses unlike fixed deposits.

Just like fixed deposit, you can terminate your TBills anytime. You don't need to wait till maturity.

henryomez:
Tbills is fix deposit with cbn while the other is with your Bank. Another diff is that tbills Starts from 1m and above while fd is 100k. Tbills has to be either 3months 6months and 1yr while fd is from 1month. Tbills rate is same irrespective of the amount its the tenor that determines the rate while fd ia amount that determines the rate. Fd pays your interest at maturity while tbills pays upfront these are the major diff

Wrong you can do tbills for as low as 200k.

henryomez:
Tbills is fix deposit with cbn while the other is with your Bank. Another diff is that tbills Starts from 1m and above while fd is 100k. Tbills has to be either 3months 6months and 1yr while fd is from 1month. Tbills rate is same irrespective of the amount its the tenor that determines the rate while fd ia amount that determines the rate. Fd pays your interest at maturity while tbills pays upfront these are the major diff

you can do tbills for as low as 200k.

Google it na!

Atiku2019:


Niger state? Or Country Niger?


How much is a bag of beans now over there and how much will it be in August

Niger state.
Currently its about 20-25k. But I don't know if there are states that have them invheaper quantity.

In august or so, a bag would sell for like 50 and above

Beress:

Based on this, it means N1m TB will give u N480k in one year... I think is cool sha

Nope, you cannot get up to that

Beress:

Based on this, it means N1m TB will give u N480k in one year... I think is cool sha

In 90days you get 1000000*90*12/36500= 29598.04

northvietnam:



I prefer buying a piece of land or giving out a bus on higher purchase(involve a lawyer in the agreement) than invest in all those trash...

The last one I did made me cry...

doesn't meet ur expectations? Share wit us

Beress:

Based on this, it means N1m TB will give u N480k in one year... I think is cool sha

If it's that way then I'm supposed to billionaire, lol...stop dreaming

money121:


Invest in crypto

That's a different thing all together, we are talking about instruments available in the banks

Funny enough last Friday I had a chat with one of the banks I use on these things....

rather than keep money in an ordinary savings account, one can use one of these

Sage7:
TB- interest is received at the point of debit. FD- interest is received when it is terminated.

TB- tenure must be complete before termination. FD- you can terminate anytime.

TB- interest is slightly higher vice-versa

No, FD’s interest can be received either upfront (at point of debit) or back end (after maturity)

The interest varies. Sometimes, TB can b higher or lower depending on how well the govt wants to mop up money from the economy.

TB doesn’t have a fixed tenor, it varies day by day. There’s 57 days, 105 days and more. While FD varies from 39 days to 180 days.

The minimum investment amount on TB is 100k

Hallenjay:
doesn't meet ur expectations? Share wit us

I already did scroll up

northvietnam:



I have done both...

Land do take time to appreciate but it's the safest for me.

Been into transport shaaa..
A cousin bought a truck (tipper) for 3.5m (2016), he traveled back abroad so I was looking after the teuck...

The first driver messed the truck up cuz he was related to us ( wasn't doing account weekly which is 60k dry season 45k to 50k raining season). After some months I returned the truck home then started consultation.

After all set and done, I took 400k and returned the truck better than it was when they bought it...

Then I put it up for higher purchase... I told our priest( catholic) and he also made the announcement in church service..

It took small time shaaa but I finally got a serious man.. he made deposit of 500k before he took the truck and is returning 62500 weekly... sometimes he do return double of the money in a week so we just do check and balance...

As I'm talking to you now, his conductor is begging secretly to couple a sound truck for him...
That he's ready for my terms and conditions...

You might not like the biz style but it's ok for me.

Banks will tell yo they want to bid for the TB , that you should deposit money in an account wich you can't withdraw again, once they are done with the biding of what ever they are bidding the money dsiappears.. and u will be making peanuts as gain

Every business has risk and the risk should be equal to the return. TB is risk free and can still guarantee a yield of 30% yearly if the upfront interest is invested in another asset class.


You are lucky to have gotten someone to manage your truck well for you and that don't mean another person will have the same luck.
Transport business doesn't always work the way you have put it.

I have invested in transport business twice first as a corper serving in the north ( got a water truck and leased it out to someone to be fetching water for corpers at a cost) and also a truck. The experiences were not too good but thankfully I got my capital out.

Point I am making is that investment is a matter of opinion and risk appetite. My parents only do TB because it is risk free and they can sleep well at night knowing that their life savings is intact.

The best is to give the pros and cons without bias and leave the decision to the person.

kingpole:
Treasury bills is better since you don't need to pay a withholding tax, but for some a fixed deposit may be better since you can decide to withdraw before the fixed date.

Just spotted that Withholding tax thing in the doc I collected from my bank when I went to enquire about these.

I understand there's a penalty for those that pulls out before the end of the fixed deposit tenure

post=63966805:


No, FD’s interest can be received either upfront (at point of debit) or back end (after maturity)

The interest varies. Sometimes, TB can b higher or lower depending on how well the govt wants to mop up money from the economy.

TB doesn’t have a fixed tenor, it varies day by day. There’s 57 days, 105 days and more. While FD varies from 39 days to 180 days.

The minimum investment amount on TB is 100k

TB is sold in 91day 182 day and 365 day tranches at primary auction unless you are buying from the secondary market of which they will re discount TB already sold at the primary auction for you through open market operations

guardiola:


12% is what you get in 12 months, so you effectively get 1% for each month, 90 days will be 3%.

Interests are quoted per annum

it's not true... .I once tried fd last two years and fcmb gave me 5% bt der tax n other calculation reduce d interest

ecolime:

Wrong.

12% on 1M for 365 days is N120k.

12% on 1M for 180 days is N60k

12% on 1M for 90 days is N30k

Doesn't make sense IMHO. I would rather invest the money in a good business than tie it down in the bank or cbn.

it makes sense if you're investing huge. You would not be having this mindset if you're investing a billion. You'd feel safer investing a billion naira in treasury bills than a business you're not completely sure will not make a loss. The wealthy enjoy the benefits of treasury bills than the average joe

Sage7:
TB- interest is received at the point of debit. FD- interest is received when it is terminated.

TB- tenure must be complete before termination. FD- you can terminate anytime.

TB- interest is slightly higher vice-versa

...am baffled, not by your response alone,but by the so many like's you got from it..a simple question was raise about what the difference between two forms of investment are..instead of to broadly explain what they are.you instead delved into its differences in returns without actually saying what each of them are thereby still making people that don't know what they mean to still be awe as of what they mean.had you been.my student,i would have scored you 2/10. am surprised dou at the art of like's you got

pol23:
TB is no long time ooo...
Mine in Diamond bank is for 90 days.
12%.
FD is sh*t

I was thinking the 12 percent is for 1year?? Then for your 90days you'll get (((12%xCapital)/365)x90 )

Beress:

Based on this, it means N1m TB will give u N480k in one year... I think is cool sha

Wrong. The rate is calculated annually. N1m will give you 140,000 after 1 year if its 14% rate. Very poor right? Its not poor to some people though.. Different people, different risk appetite

Treasury bill involves instant interest received with the principal held in CBN for 90 days.
Fixed Deposit is for a period of One month plus with interest paid to the owner of the money who made the deposit.
My father in 2012 made a deposit of N1,000,000 with an instant N24,000 as interest received (i.e with C.B.N).
Also, he made a Fixed Deposit of N500,000 with GTBank for a period of 31days plus and received an interest of N2,400.
With this I hope it will help.? thanks.

northvietnam:



I prefer buying a piece of land or giving out a bus on higher purchase(involve a lawyer in the agreement) than invest in all those trash...

The last one I did made me cry...

While you have a point there, the FD and TB are more secured and less risky than buying of Land ( which is a very good one both on short and long term ) as you may fall into wrong hands and lose your money completely.

12345baba:
do we have a govt?

A horrible administration but yes we do.

Sage7:
TB- interest is received at the point of debit. FD- interest is received when it is terminated.

TB- tenure must be complete before termination. FD- you can terminate anytime.

TB- interest is slightly higher vice-versa

TB are issued by government. It can be discounted before maturity

FB - some form of FB pay interest upfront. FB are issued by banks

crowntoro:
Nope, you cannot get up to that

Lol. The guy will have to print that amount himself as interest

ladyF:
I can't even use my money to do any of the above. I'd rather use it to buy bitcoin when it dips. Bitcoin is bae!

It's LadyF again.

Lol...........Only if u know that T.Bills is a secure style of investment. instead of losing ur money, u rather breakeven wen it matures.