Term investment is same as bank deposits and is one of the safest investment opportunities in New Zealand. If you are looking for a safe and guaranteed return on your investment then you should consider term deposit.
We have sourced out information that will help you with term investment in New Zealand. Its easy and simple.
What is Term Investment ?
Term deposit or term investment is an unsecured bank deposit, usually for a fixed term. Term deposit usually has an agreed interest rate which is fixed for the duration of the deposit. You will get returns on your investment when it matures, this will be the interest earned for the duration of the deposit.
Term investment is similar like all the other types of investments; investment is putting your money into something with the intention to gain profits. Term investments NZ are investment whose rates are fixed till the maturity date and are is not redeemable before the term matures.
There are many things to consider when investing in a term deposit, some of the main ones are
How much to invest?
Who to invest with?
How long to invest for?
Risk involved with Term Deposits?
Advantages for Term deposit?
Disadvantages of Term deposit?
Who can Help with your investment ?
One of the things to consider when investing in a bank deposit is how much to invest, If you decide to invest all of your savings then you will have nothing left for emergencies, and if you invest little bit then you are not going get much returns.
Finding the right balance will not be hard, just invest what you can to start off with for a short term and when it matures you can add more to it. Once you get the idea of what your investment limits are then you can start investing big amounts, but make sure to keep some money aside for emergency as breaking the term investment will cost you fees.
Invest what you feel like is the safe amount and if in doubt or If you have large amount of money to invest then you can hire a investment manager who will be able to manage your investments for you.
With term deposit you earn a fixed interest rates for a set term. There are many companies that offer term deposit in New Zealand and the rates will differ from one company to another. Getting the best term investment rate can be time consuming and frustrating.
At invest.org.nz we have sourced out some of the best places to compare the investment rates in New Zealand. You can check out the latest Term Investment rates at http://www.interest.co.nz/saving/term-deposits-1-to-5-years. here you can compare the rates from different lenders at one place and see which one is the best for your investment needs.
Deciding on who to invest with can be easy if you know what to look for in a company? If you invest with the company that has the best ratings and have been trial and tested within the community then you will have lower risk of losing your money. One of the most important thing to consider when deciding who to invest with is the credit ratings. You can obtain the ratings by approaching the investment companies ( banks, financial insinuations ) or checking it out at
http://www.interest.co.nz/saving/term-deposits-1-to-5-years. This site will give you a basic credit rating for the investment company.
The best term investment companies are your local banks, they offer low risk term investment and if you have been using a particular bank for a while then talk to one of the banking managers, they will be able to guide you through the process of getting you setup for a term investment.
Make sure you always do your own research and find out as much as possible about a company or bank before setting up an investment with them. If you need further advice please consult with a processionals investment manager or adviser.
Deciding on how long to invest is going to crucial, as with term investment the longer you invest for the higher the return on investment. The downside of this is that you will not be able to gain access to your money for a long periods, you will have to break the term investment to gain access to it and you will incur fees for this. Investment rates changes quite often and if you decide to invest it for a longer term you might lose out on the valuable term investment rate increase.
If you got bit of money to invest in bank deposit then consider splitting them into short and long term deposits. This will give you access to money when the short term investment matures while still getting higher returns on the long term investment.
At the end of the day think of what your savings goals are and then decide on how long to invest. if not to sure then your local banks will be able to guide you.
Risk involved with Term Deposits ?
As with every investment there is a certain risk involved and term investment is the same. Term deposits are usually the safest type of investments but there are times when you can lose everything that you invested. If a bank or the company that you invest with goes bankrupt then you can lose all your deposits.
This is rare but its not impossible, in overseas some of the major banks have failed and people have lost lot of money. New Zealand banks have good ratings and have been great for short and long term investors.
If you are looking to invest large sum of money with the banks and want to minimize risk then best option is to use several banks or financial insinuations instead of one. In this situation if one of the companies fail then you will only lose the money you have deposited with them but your other investments with other institutions will be safe.
Always check the companies credit ratings and do you research before investing your life savings with any one as its takes years to accumulate savings and few days to lose it.
Advantages of Bank Deposit
One of the safest investments around.
Good return on Investment ( Banks are giving out good term deposit rates )
Low risk investment ( less volatility in the term deposit market )
Guaranteed returns ( You will earn interest from your investment when it matures )
High liquidity (can have access to your investment if you need to in a hurry )
Disadvantage of Bank Deposits
You will no have access to your money unless your break the term deposit
Fees will be charged if you decide to access your money before it matures
Risk of losing all your money if the banks fail ( Not likely but p[possible )
Low return on Investment compared to some of the other investments
Who can help with Term Deposit ?
When looking to invest large amount of money its best to talk to your local bank mangers, they will be able to advice you the safest and best way to invest you money with them. You can also ask them to provide you with an investment statement with their credit ratings.
If you are still not convinced and like professional help then consider getting professional advice from an investment adviser.