Due to the continuing volatility in markets due to the world recession and also the uncertainty within the Euro area, more and more people are looking at more conservative and safer options to invest their money.
Whether it be your pension plans (including any transfers from existing pensions and Approved Retirement Funds) or indeed any investment lump-sums there is an excellent product that is now available for a limited period which will offer a very attractive fixed return over a number of years.
One such product is explained below. Please note that there are shorter term options available but the fixed return would be less. The concept here is to get a greater return than being in a cash fund or on deposit but with more or less the same safety net.
1) Fixed Medium Term Deposit Funds
This fund provides you with a very attractive fixed return of 28.74% gross at the end of a 61 month investment period (until 27th July 2017) The fund invests in a fixed rate deposit account with EBS. Closing date for this investment is 27th June 2012. There are no withdrawals allowed before 27th July 2017.
Risk Description: This fund aims to provide gross returns similar to those available from deposits or savings accounts from Irish Banking Institutions. There is still a risk that the value of the investment could fall, particularly if you access your funds before the end of the fixed term period.
Investors in this fund are also exposed to counterparty risk. A counterparty is a financial company who provides the capital protection and/or returns on a deposit. Counterparty risk is the risk that the financial company will fail to fulfil its obligations to the insurance company. The counterparty on the insurance company fixed term deposit fund is EBS. The counterparty risk to you is the risk that EBS Ltd does not pay the insurance company what they owe.
Return on €100k investment : €128,740 (gross of charges)
2) Deposits
Again in an era were people are craving safety for their money instead of risking their investments, many are turning to bank deposits. There are a number of different options available to suit everyone’s needs. The best of these options in a number of categories are outlined below to give you an idea of same.
Deposit Amount €20,000
Demand A/C
– KBC Smart Access Demand account Rate 3.25% CAR
– Leeds Variable 90 day Notice account Rate 3.25% CAR
1 Month Account
– PTSB 30day Notice variable Rate 3.00% CAR
– An Post Deposit A/C Plus (30 day notice) Rate 3.00% CAR
1 Year Account
– KBC Fixed term – 1yr Rate 4.1% CAR
– KBC Top-up Deposit A/C Rate 4.1% CAR
2 Year Account
– AIB 2yr fixed (broker only rate) Rate 4.05% CAR
3 Year Account
– KBC Fixed Term – 3yrs Rate 3.77% CAR
5Year Account
– KBC Sure Income (half yrly) Rate 3.53% CAR
C.A.R (Compound Annual Rate) Interest rates are expressed as compound annual rate (CAR) in order to make a comparison of different returns for different periods or interest rates. CAR is the equivalent rate per annum and assumes that for periods of longer than one year, the interest is compounded on an annual basis. In simple terms CAR is what the interest rate would be if interest was paid or credited each year.
For further information about these or any other deposits or deposit based products please contact Terry or Philip (01) 8693400.
