Is good to see more Nigerians trying to invest their money for future financial security. Now the only two less risky investment that most Nigerians tend to go for his either Fixed Deposit Investment or Treasury Bills Investment (T-bills). I have been involved in both investment multiple times but after carefully review of my returns and the risks involve (which is pretty NADA to be candid) I can state with all confidence that Fixed Deposit investment is the best between the two.

Now before I let the cat out of the bag, let me quickly add that this simple logic I am about to unveil is only viable for folks that want to invest at least ₦2 million and up and also for a full calendar year because if you are planning to invest less than the stated amount (₦2 million) the interest rate plus the number of days of investment in your portfolio will not add up. Now let's get started---

Treasury Bills Investment
As we all are aware that treasury bills investment is the least risky investment out there with moderate return and plus the attractive rates folks are getting on it lately, thus making it the number one option for most folks to invest in but does the returns on this investment really worth the hype?! I do not think so...
For example Mister A has ₦5 million to invest in T-bills for 365 days at Bank 1. They offered him 14.5% (for the sake of this argument lets round it up to 15%). At the end of 365 days (1 YEAR) Mister A will receives ₦750k back in return after 1 Year

Fixed Deposit Investment
Now if Mister A takes the same ₦5 million to Bank 1 and request to fixed the same amount for 90 days (with automatic roll over after 90 days and insist on the same fixed rate) which most banks will offer Mister A 10% or more (but most folks will not agree with me but for the sake of argument let say he was able to get 10% for 90 days). At the end of 90 days Mister A will receives ₦500k in return X 4 = ₦2million cool cash. A return of 40% compare to 15% of T-bills for the same number of days.

As we all can see the return on Fixed Deposit is by far the best investment option between the two. As for me T-bills does not really worth the hype. Yall free to do your investigation.
Happy investing
¬ OnlyTru¬

Your calculation on the FD is incorrect. At the end of 90 days, Mr. A gets N500000*(90/365) thus, he doesn't get N2million at the end of the year. For both instrument you quoted, the interest rate you get us what should guide you on which to invest in.

I am surprised at the OP's calculation for the FD. This is especially so because of the claim to have invested in both TBills and FD.

Well, even after compounded interest, you don't still get up to 750k from fixing 5m at 10% interest rate for 90 days in four places. Don't also forget that with Tbills, your interest is discounted.

Wrong.

Fixed deposit is not calculated on a flat rate but with a compound interest as the guy above me highlighted.

The major difference between the two is that the interest on T-bills is paid upfront while the capital stays till the end of the tenure. You can not terminate your investment prematurely.

Interest on fixed deposit is paid in full on the maturity of the investment but you can terminate your investment prematurely when you have urgent need for cash. The banks charges a token for premature termination.

I think T-bills make more sense ...though I will never take any of the option.

Give me N5m, I will return at least N1m every two months.

dunkem21:
Wrong.

Fixed deposit is not calculated on a flat rate but with a compound interest as the guy above me highlighted.

The major difference between the two is that the interest on T-bills is paid upfront while the capital stays till the end of the tenure. You can not terminate your investment prematurely.

Interest on fixed deposit is paid in full on the maturity of the investment but you can terminate your investment prematurely when you have urgent need for cash. The banks charges a token for premature termination.

I think T-bills make more sense ...though I will never take any of the option.

Give me N5m, I will return at least N1m every two months.

How?

@ op,

note that the 90 days is divided by 360 days. hence 5m *10%*90 / 365 = 123,288 so at the end of the yr the person gets less than 500,000.

2m nke? if it is so, then we should all be rich by now.

get ur fact very well before u misled person next time.