What are the disadvantages of bank deposits ?

1. Low interest rates: Bank deposits typically offer lower interest rates compared to other investment options such as stocks, bonds, or mutual funds. This means that your money may not grow as quickly as it could with other investment options.

2. Inflation risk: Inflation can erode the purchasing power of your money over time. If the interest rate on your bank deposit is lower than the rate of inflation, your money may actually be losing value in real terms.

3. Limited liquidity: Bank deposits are generally considered to be a safe and stable investment option, but they may not offer the same level of liquidity as other investments. Some deposits may have restrictions on when you can withdraw your money or may charge penalties for early withdrawals.

4. Deposit insurance limits: While bank deposits are typically insured by the government up to a certain limit (e.g. $250,000 in the US), if you have more than the insured amount in a single bank, you may be at risk of losing some of your money in the event of a bank failure.

5. Opportunity cost: By tying up your money in a bank deposit, you may miss out on other investment opportunities that could potentially offer higher returns. This is known as the opportunity cost of keeping your money in a bank deposit.