While bank deposits are generally safe, there are some risks to consider:
Inflation Risk: If the interest earned on deposits is lower than the inflation rate, the real value of the funds can decrease over time. Bank Solvency Risk: Though rare, banks can fail. Deposits in insured banks are protected up to certain limits, but amounts exceeding these limits could be at risk. Liquidity Risk: In the case of CDs, funds are locked in for a specific term, which may limit access to cash when needed.