If you locked in a term deposit at 3% or 4% back in 2023 or 2024, you caught the best cash rates Europe had seen in over a decade. Now that deposit is maturing, your bank is quoting closer to 1.5–2% to roll it over. The ECB cut rates repeatedly through 2024 and 2025, and deposit rates followed them down, as they always do.
This is what advisers call a money-in-motion moment, and banks know it. The maturity letter usually arrives with a “special offer” attached, and the default option, doing nothing, quietly rolls you into whatever rate the bank feels like paying. Neither of those is a plan.
There is no single right move, because the right move depends entirely on what this money is for. Here is the framework I’d use myself: define the money’s job first, then match each slice to the right home, whether that’s a new deposit, a ladder, a money market fund, or a proper long-term ETF portfolio.
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Before comparing a single rate, answer one question: when will you genuinely need this money?
Most term deposits fall into one of three buckets: genuine short-term money (a house deposit due next year, a car, a renovation), the emergency buffer, and, surprisingly often, long-term money hiding in deposits — savings with no defined purpose that have rolled over for five or ten years because a deposit felt safe and required no decisions.
That third category is where the real cost sits. A deposit paying 2% while inflation runs at 2% earns nothing in real terms, and after tax on the interest you are usually going slightly backwards. If part of your maturing deposit is honestly ten-year money, the question is not “which bank pays 0.3% more” but “why is this money in a deposit at all”.
Option one: roll it into a new term deposit
Rolling over is right for genuinely short-term money. If you need the cash in 12 or 18 months for a defined purchase, a deposit remains the correct vehicle: the return is known in advance, and balances up to €100,000 per person per bank are covered by your national deposit guarantee scheme.
Two practical points, though. First, never accept the automatic rollover rate. Banks reserve their best rates for new money; the rollover rate offered to existing depositors is frequently 0.5–1% below what the same bank, or a competitor, advertises publicly. Fifteen minutes on a comparison site usually pays better than any hour you’ll work that week, and EU deposit platforms now let you reach banks across the Union under the same €100,000 guarantee framework.
Second, resist chasing the highest rate into a long lock-up. Committing to a three-year deposit just because it beats the one-year rate is a bet that rates fall further. Maybe they will. But you’ve turned a safety decision into rates speculation.
The deposit ladder
To keep a larger sum in deposits without locking everything away, split it into three or four slices maturing at staggered intervals, say 6, 12, 18 and 24 months. Every few months a slice matures: you get regular liquidity, you’re never fully locked in at one rate, and each maturity is a fresh chance to reassess. It is boring and it works, which describes most good financial decisions.
Option two: money market ETFs
For flexible short-term money, euro money market ETFs are worth knowing about. They track overnight euro rates (linked to €STR, close to the ECB’s deposit facility rate), so the yield floats with ECB policy rather than being fixed at purchase. You can sell any trading day without penalty, their genuine advantage over a term deposit.
The trade-offs are real, though. A money market fund is an investment, not a bank balance: there is no deposit guarantee, although the underlying instruments are very low risk and your units are held segregated from the broker’s own assets. The yield also falls after every ECB cut, whereas a term deposit locks today’s rate for the full term — in a falling-rate environment, that fixed rate is what the deposit’s inflexibility buys you. I compare these vehicles in my guide to short-term investing in Europe, and for a six-figure sum, where to park €100k short term covers the practical mechanics.
Option three: the long-horizon money goes to work
Here is the uncomfortable part. If a chunk of your maturing deposit is money you won’t touch for ten or more years, rolling it into another deposit at around 2% has a cost that never appears on any statement.
Run the rough numbers on €30,000 over 15 years. In deposits averaging 2% nominal, you end with about €40,000 before tax; with inflation near the ECB’s 2% target, the real purchasing power is barely above where you started. The same €30,000 in a diversified global equity ETF portfolio, using 6% as an illustrative long-run nominal return (never a promise), compounds to roughly €72,000. Equities will lurch around on the way, sometimes brutally, but for money with a decade-plus horizon, volatility is the toll you pay for returns that actually beat inflation. A deposit’s safety is safety of the number, not of what the number buys.
This doesn’t mean lurching from a deposit into stock-picking. A single broad, accumulating world ETF at a total expense ratio around 0.1–0.25% is how most calm European portfolios start. My beginner’s guide to ETFs covers the mechanics from zero, and if the maturing sum is substantial, the thinking in how I’d invest €50,000 of savings maps almost exactly onto this situation.
Comparing your three main options
| Feature | New term deposit / ladder | Money market ETF | Global equity ETF portfolio |
|---|---|---|---|
| Best for | Known expenses within ~1–3 years | Flexible cash, undecided money | Money untouched for 10+ years |
| Typical 2026 yield | ~1.5–2.5% fixed (verify current offers) | Floats near ECB short-term rates | Unknown; ~5–7% nominal as a long-run illustration |
| Access | Locked until maturity (penalties apply) | Any trading day | Any trading day, but selling in a downturn hurts |
| Protection | €100,000 deposit guarantee per bank | Segregated fund assets, no deposit guarantee | Segregated fund assets, market risk fully yours |
| Beats inflation after tax? | Rarely, and barely | Roughly matches it at best | Historically yes, over long horizons |
| Main risk | Reinvestment at ever-lower rates | Yield falls with each ECB cut | Drawdowns of 30–50% along the way |
Rates shown are approximate 2026 figures for orientation. Check the ECB’s official key interest rates page and your bank’s current terms before deciding anything.
The split approach: you don’t have to pick one
In practice, the best answer for most people is a split, because most maturing deposits contain several kinds of money mixed together. A sensible structure: keep three to six months of expenses as an emergency buffer in instant-access savings or a money market fund; put money with a named purpose inside three years into a fresh deposit or short ladder; and move the genuinely long-term remainder into a diversified ETF portfolio.
If moving a lump sum into equities in one go makes you nervous, you’re normal. Statistically, investing immediately wins more often than spreading it out, because markets rise more often than they fall, but the behavioural case for phasing in over six to twelve months is legitimate: the plan you can stick to beats the optimal one you abandon at the first 10% dip. I’ve written up both sides in investing a lump sum at an all-time high, which is exactly the worry most deposit-holders have in 2026.
Beware the maturity-day sales pitch
One warning from experience. When a decent-sized deposit matures, many banks invite you to a “portfolio review”, and the product that emerges is rarely a simple deposit or a cheap ETF. The classics are structured notes with capital protection and equity-linked upside, unit-linked insurance wrappers, and the bank’s own actively managed mixed funds. They share three traits: complexity that flatters the seller, annual costs often in the 1.5–3% range once you stack entry fees and ongoing charges, and returns that historically trail a plain index fund.
The pitch works because it targets exactly your situation: you want more than 2% but fear “the stock market”, so a capital-guaranteed note sounds like the perfect middle path. In reality the guarantee is paid for by capping your upside and burying costs where you can’t see them. If you want equity exposure, own equities through a transparent UCITS ETF with a published cost. If you want safety, use a guaranteed deposit. The expensive hybrid mostly serves the person selling it.
Don’t let rate-chasing become the hobby
A brief behavioural note. Some savers respond to falling rates by turning deposit-hopping into a part-time job, moving money every few months for an extra 0.2%. On €20,000 that is €40 a year before tax. The far bigger lever is asset allocation: whether your long-term money earns deposit rates or equity returns matters ten times more than which bank tops this month’s table. Optimise the big decision once, then let the small ones go.
What I’d do
If my own deposit were maturing this month, I’d sort the money by job: buffer, short-term goals, long-term surplus. Buffer goes to instant-access or a money market fund and stays there. Short-term goals get a new deposit at the best rate I can find from a guaranteed EU bank, laddered if the amount justifies it, never at the lazy rollover rate. The long-term surplus, often the largest slice for long-time savers, goes into a broad accumulating world ETF, at once or phased over a few months if that’s what my nerves need. Whatever the bank offers in the maturity letter, I’d read purely as marketing.
Falling rates are genuinely bad news for the deposit slice. But they’re also the nudge many people need to finally separate real short-term money from long-term money that has been idling in cash for years. The maturity date is your built-in decision point. Use it.
Frequently asked questions
Q: My term deposit is maturing, should I just let it roll over automatically?
A: Usually not at the default rate. Automatic rollovers often land 0.5–1% below the best available offers, because banks reserve stronger rates for new money. Compare current rates before maturity day and actively choose, even if you end up staying at the same bank.
Q: Are term deposits still worth it now that rates have fallen?
A: For money you’ll need within one to three years, yes: the rate is locked, the outcome is certain, and the €100,000 deposit guarantee applies. They are a poor home for ten-year money, though, because after tax and inflation a 2% deposit rarely grows your purchasing power at all.
Q: What is safer, a term deposit or a money market ETF?
A: A term deposit within the €100,000 guarantee limit carries state-backed protection that no fund can match. Money market ETFs are nevertheless very low risk: they hold short-dated, high-quality instruments and your units sit segregated from the broker’s assets. The practical difference is that the ETF’s yield floats with ECB rates and carries no fixed guarantee.
Q: Should I invest my whole maturing deposit in ETFs at once or gradually?
A: Historically, investing a lump sum immediately beats phasing in more often than not, because markets rise most years. But spreading purchases over six to twelve months is rational if it stops you panicking at the first dip. Decide the schedule in advance and automate it, so the decision is made once.
Q: How much of my deposit money should I move into an ETF portfolio?
A: Only the slice you genuinely won’t need for roughly ten years or more. Keep three to six months of expenses as an accessible buffer, and keep money with a named short-term purpose in deposits or a money market fund. Whatever remains after those two jobs is the honest candidate for a diversified equity portfolio.
Q: My bank offered me a capital-protected structured product instead of a new deposit. Is it a good deal?
A: Be sceptical. These products typically combine capped upside with layered fees that can total 1.5–3% a year, and they exist largely because they are profitable to sell at maturity moments like yours. A plain deposit for safe money plus a low-cost UCITS ETF for growth money almost always does the same job more cheaply and transparently.
This guide is part of our hub on investing a windfall, inheritance or payout — browse the full cluster for related situations.
European UCITS/ETF investor with 11+ years building a global dividend and index portfolio, and founder of Financial Expert Class. I write every guide here from first-hand experience investing across EU brokers and tax regimes — not theory. More about me →