Deposits – time for a re-think?

Australians have long liked bank deposits. Those in this $2 trillion market got a simple and safe investment. Today, though, it’s a new world. Soon-to-be enforced bank regulations will mean you cannot break a bank term deposit at will. You will need to give 31 days notice. Even then, you may forgo interest. The regulations may also favour rates given to individuals and small businesses. All others, including Self Managed Superannuation Funds (SMSFs), may be worse off. For investors who want a degree of safety and access to funds, an A$ corporate bond fund now may make more sense. True, it’s a little riskier. But you typically get better returns than deposits and ready access to your funds. In this yield starved world, this has the potential to make a big difference.

Read more – Spectrum Insights: Deposits – time for a re-think?