Banking Investments

Term Deposits offer solid returns and high security

In today’s economic environment, finding a safe investment isn’t easy. Purchasing shares can provide a risky option, with the stock market experiencing significant fluctuations in recent times. But if you are looking to lock in a great interest rate, flexible terms and security for your money, a term deposit could be the answer.

Simon Purcell, the Investment Relations Manager at Defcredit, recommends that if you have money to invest, it is important to seek independent financial advice to ensure that you are receiving the most suitable product for your individual circumstances. An online savings account provides a flexible option, but is certainly not for everyone. The interest rate of an online savings account can decrease overnight, so many people prefer to lock their money in at a fixed rate for a specific period of time.

“If you’re considering a longer term investment, the great news on term deposits is that if you keep it for the full term, typically there are no fees, no service charges, and no fuss. And Defcredit offers some of the most competitive interest rates on term deposits available” Simon said. With various terms and amounts starting from $1,000, you can select what best suits your needs. The only real disadvantage is that if you require your money instantly, you may incur a fee or a reduction of your interest received.

An investment that is guaranteed by the Australian Government

Another big advantage of most Term Deposits is that they are guaranteed by the Australian Government. This means that you can lock in a great rate from an investment that is also very secure. But be careful, as this guarantee only extends to authorised deposit-taking institutions. Simon recommends “before investing, always ask your financial provider if your term deposit will be government guaranteed”. The guarantee automatically covers your total deposits with any single institution up to $1 million. However, you can obtain a guarantee upon application if the amount is above the $1 million limit, but you may incur a fee or a reduced interest rate.

Many credit unions are covered by the government guarantee. Credit unions are owned by their members so they don’t have to pay dividends to shareholders, this means that profits are re-invested for members. As a result, many credit unions are able to offer very competitive term deposit rates compared to banks and other financial institutions, but also offer the protection of the government guarantee. Credit unions pride themselves on their customer service, so not only will you get highly competitive products, but you can also expect to receive a high level of personal service.

Information supplied by:

Defcredit (Defence Force Credit Union Limited)

Simon Purcell, Investment Relations Manager

Phone: +613 8624 5430

Email: simon.purcell@defcredit.com.au

Website: www.defcredit.com.au