thought this is a great rate for a term deposit, given that the shares market is all over the place.
Best out of all the banks.and a Min. deposit $5,000 interest rate
Special term deposits
Special term offer
6 Months 5.10% p.a.
12 Months ¹ 5.45% p.a.
Referrer and referee get $20 each. Maximum $100 per person.
You mean 6%?
Lol yes, not sure why I type 10%
To be fair, that would be a very good deal!
If anyone is on the investnow.co.nz platform this is available on there too.
For those that aren't, its a managed + ETF funds centralised platform, and theres a handful of term deposits available on there. The benefit being you don't have to do separate paperwork to sign up to the various banks you might shop around with a term deposit at.
+1 for InvestNow. Their own new funds look pretty good.
Where is the money held and is it less secure than going direct? I can't see mention of the security of the money by using invest now as the middle Man.
See here
https://investnow.co.nz/faq-items/how-are-my-funds-protected…
This article reverences the same custodian is used for term deposits.
https://investnow.co.nz/article-getting-to-know-investnow-te…
For some context on the company, many of their customers are from when Rabobank exited the managed funds business and investnow took them on with a migration arrangement.
Thanks for sharing this! This make investing more convenient.
Be careful, terms deposit and terms investment are different, terms deposit is safest with legal protection for your saving if bank is failed. Meanwhile terms investment is just anoth type of investment tools and you need to manage the risk
Term deposit with invets now? its the same as Term deposit , they use banks , different custodians
https://www.interest.co.nz/ is a useful comparison site for anyone wanting to look at rates across all banks and a number of non-bank lenders.
Yea BNZ is similar. Easier to setup than joining another bank too. And minimum deposit I think was $2,000.
Heartland 5.7% for 9 months may be better. I asked bnz to price match and they beat it by matching 5.7% with monthly compounding which is better. Also pie accounts available. Not available at cooperative bank or sbs
Cool. Did you do it with the app messenger? Tends to be hit and miss for me.
you can either phone and ask to put through to the special pricing team to term deposit or you can do a internet message via the secured mail via the log in. (Phone is faster).
I’ve tried message, will post how it goes.
@jcrob111: I can confirm that they have matched the 9 month rate at 5.7% but declined to match the 6% at 12 month (not matching SBS.
@gooddeals: are they price match post open or before opening of account? i would be keen to get this sorted asap…
@jackvdbuk: Agree on the rates and terms first before opening a term pie or term deposit. If you want it sorted ASAP just call them
@gooddeals: Do you know if they will they match interest rates for pie deposits or just term deposits?
@gooddeals: Just got told by bnz that they will only match main bank rates! Maybe I should try my luck on a phone call instead of app message.
@thats mum life: You need to ask them to submit a bid to the pricing team, not just ask for a rate match. I have a colleague did get 5.7% as well for a 9 month term
@gooddeals: They said they couldn't submit to the pricing team but I've pushed back to see what they say. Thanks for the tips!!
@thats mum life: Called them and asked them to submit a bid to the pricing team. They rang back within the hour and declined to match the 5.70% term PIE from Heartland Bank :(
Not sure I did the right steps here?
@gooddeals: Success they agreed to submit to the pricing team and it’s been approved - just need to complete the paperwork. Thanks for the tips!
Effective Annual Rate (APY)
5.851% with monthly compound
thanks, so clearly the 9 month term at 5.851% is better deal if you don't need use your funds in a hurry compared to the coop option of 5.1% over 6 months. you need 7.3% to make up the last 3 months to have a similar rate over the final term, which seems unlikely to happen.
sorry if this sounds stupid, i’m new to TDs but like … 5.7% for 9 months is better than 5.75% for 12 months (rabobank), right? and then what about 5.7% for 9 months vs 6% for 12 months (sbs)?
i feel mad goofy now because i did a fair bit of research before deciding on rabobank because i thought their rates were the highest and now i have 3 TDs with them maturing next year february :(
good questions..
whether your goal is to get the best possible return (flexible on terms and duration) or whether you need your money at a defined time then determine the best possible rate within that defined time?
keep in mind that OCR is increasing and currently at 4.25% but may get up to around 5.25% perhaps (in the next few months before falling), and most "experts" think that interest may not fall until next year. so term deposits are likely to be higher than that but not a lot more once OCR has peaked.
5.7% monthly compounding for 9 months has an effective rate of 5.851%pa over the term. so better rate than 5.75 pa.. so hopefully to pick up another term deposit once matured and lock in at a higher rate.
The issue with Rabobank and SBS, cooperative bank (for some people) is that they do not have term PIE as an option, which has lower tax rate, i.e. it's the after tax return that matters, but that depends on your income and whether you would be advantaged by the term PIE option.
BNZ and many other major banks (as well as smaller banks like Heartland) has term PIEs available, and BNZ offers monthly compounding (so matching means it effectively beats other banks that do not offer monthly compounding.
To be fair rabobank rate at 5.75% over a year is not bad but how good this is depends on your tax rate.
see for reference the effective rate of term PIE
https://www.interest.co.nz/saving/term-pie
PS I am not a financial advisor and please treat this as a discussion forum only!
Wow didn't even on know about pie terms, what is actually the point of standard term deposits as nearly all would be better off with the lower tax rate if on the higher bands right? .
@jackvdbuk: A term PIE is not always better so it pays to do some homework first.
Yes you could end up paying less tax, but with a PIE fund the tax is final. In other words if you end up on the wrong rate you won't get a refund from IRD.
The first thing is to work out what your PIR tax rate is: https://www.ird.govt.nz/roles/portfolio-investment-entities/…
If this is less than your income tax rate then it could be beneficial as a PIE fund is capped at 28%.
@bigcheese: Did this not change a few years ago in terms of getting a credit or refund if on the wrong PIR? Just reading this page https://www.anz.co.nz/personal/investing-kiwisaver/tips-tool…
thank you for your reply! it was very insightful even though i am very clueless. regarding my term deposits, im not in a rush, just wanting to make as much interest as possible (using interest free student loan lol)
i tried searching up the terms that you used but i’m still a bit confused. does effective rate only apply for PIE? i used the PIR calculator (ty big cheese) and my rate is 10.5% which is the same as my normal tax. so this does mean that i don’t need PIE .. right?
thank you kind sir
ok i did a lot of useless calculating because my brain somehow thought that 5.7% for 9 months (and reinvested continuously) gave more interest than 5.75% for 12 months but anyways i now understand that rabobank is the way to go for me! or maybe SBS …
@toes: Yes if you marginal tax rate is at 10.5% then a term deposit is better.. You may get some tax rebate depending on your circumstances.
With BNZ and Westpac you have to apply for term PIE in person, which is very annoying. ANZ and ASB let you apply online.
@sunshinenz: That is not correct. I got term pie opened online from westpac or bnz. Just email or secure mail them via login or phone them if you wish. No need to physically go to bank in person.
Kiwibank can open term pie on your own via their log in
@sunshinenz: I had a form signed for bnz a while back for the first time then each subsequent time is just instruction and they do it as instructed. No more form to sign.
Banks generally operate a cooling off period for a short time where you can withdraw your money without penalty for change of mind.
Rabobank is 7 days.
If you think you have made the wrong decision then contact them now and ask about getting it withdrawn.
thank you big cheese for this tip! i did some calculating that took me far longer than it should have (actually it shouldn’t even have required any calculating), and i think non-PIE term deposits are the way to go for me (also thank you for your PIR link)!
actually while i’m here, would you recommend me moving to SBS for 6%pa vs rabobank for 5.75%pa? i think i had looked at SBS prior to deciding on rabobank, but people said rabobank was a safer bet because of its ratings in the A’s as opposed to SBS which is in the B’s. does this rating play an important role? or does an extra 0.25% player a larger role?
thank you kind sir
@toes: It's really up to you.
I have worked in banking previously but I'm not a financial advisor so take what I say with a grain of salt.
Based on your comments above I don't think you would gain any advantages in a PIE fund over a non PIE term deposit.
In terms of credit ratings an 'A' is ahead of 'BBB' but it is still a pretty strong rating. I would be more concerned if you looked at some of the higher rates offered by credit unions or building societies which are seen to be more risky so dangle the carrot of higher interest rates to attract investors.
A 0.25% difference is not a huge amount - works out to be an extra $25 over a 10K investment (on a simple interest basis, not allowing for compounding).
Just make sure you're comparing apples with apples in terms of frequency of interest payment or penalties for early withdrawal when making your decision.
@bigcheese: thank you so much big cheese . your reply gave me a reality check of how stupid i am . i quite literally thought 0.25 of 10,000 was $250 (missed a .0 on the calculator because it was missing a whole number, but like it once again shouldn’t even need a calculator in the first place omg . at least i calculated like 5.75% correctly and didn’t think that it would return like 5750 on a 10,000 investment) and now i am screaming crying sobbing pooping puking throwing up at my idiocy .
anyways, $25 can maybe get me beginners math tutoring session about decimals, percentages, and fractions, so im going to do more research about SBS and risks and hopefully gain some brain cells!
so sorry
P.S stay in school kids 😭
@toes: No problem.
I'm sure you will be fine with either SBS or Rabobank.
Just be wary of taking financial advice from strangers (including me!) on a Cheap deals site.
@bigcheese: @BigCheese
I am looking at buying a property, But unsure when I will pull the trigger as prices are still heading down.
In this case would a Notice saver like Kernels 4.75% suit or am I better with a Term deposit?
Dont want to stick it in Share market or property market right now. Someone lost $1M just now , bought 2021 sold today for $1M less
@Joe: My comment above about being wary taking financial advice from strangers still stands.
There are a lot of variables at play - not the least your own appetite for risk and how immediately you need the funds.
I don't really know much about Kernel but the interest rate seems reasonable for a relatively on-call account.
If you do happen to find a property you like are you happy waiting 34 days to access your funds with the Notice Saver?
A term deposit will penalise you for breaking the term early in the event you need the funds and they may still impose a notice period so probably not the best place to put it if you need it in a hurry.
The other thing to think about is whether you will also be using any Kiwisaver money for the home deposit? If you are, think about what fund type you are in now as a higher risk fund could well drop at the moment you need to access the funds so may be better in a defensive / conservative fund even though this will likely earn you lower returns.
The key is what is the most important to you - security of fund balance or potential for higher returns (but also bigger losses).
@bigcheese: Thanks a lot.
How come you write so clear and concise? Are you a writer? Bet you avoid social media like a plague
That is where I lost my writing skills, if any I had :)
@Joe: No problem.
I'm definitely not a writer though but appreciate the comments.
As far as social media goes I'm not a big user - I spend too much time on this site to have time for it!
If you have a mortgage, would you put your cash into term deposit now or open a flexible account to offset against high interest rate?
What type of home loan do you have?
Depending on which bank you are with you can generally make a lump sum deposit even on a fixed term mortgage, and on a floating loan put as much as you like.
I would be looking at what interest you are paying on your loan vs what you could potentially make in a term deposit.
Pretty much always better to put it against the loan and reduce your level of debt.
I currently have 2 fixed+1 flexi, looking to open another flexi when 1 of the fixed due this March, I'm with ANZ, if I open a flexi instead of making a lump sump, it would be easier to use it as a deposit if I'm planning to buy another house?
Just checked ANZ current have 1 year fixed for 6.49%, if term deposit is 6% for 1 year I would better off open a flexi using that money right?
Flexi normally 1% plus higher than fixed rate
Not necessarily.
The flexi loans give you the benefit of revolving credit and redrawing up to your limit but you pay for that in terms of having a higher interest rate.
As long as your flexi account allows you to redraw then it would reduce the amount of interest you are paying.
I would suggest you make have a chat with a mortgage broker now and look at some options.
It won't cost you anything except some time and might save you a bit in interest!
Don't forget about the $12.50 monthly account fee for Flexi.
Keep in mind OCR likely to go up at least .5% on Feb 22.
yes, this is correct, but this is already factored in by the market already. At one stage some banks were thinking about a 0.75% rise, but now the consensus is around 0.5%.
So a 0.5% will have more impact on the cash/ short term rate, but lesser impact on the longer term rates. Also the major banks generally will take their time to rise deposit rate post OCR announcement. So you gain some more interest by locking in now, but may get less interest in the latter months potentially.
Is it though? Banks are still increasing rates now, and they often say it is already factored in, but then they still increase them a week later.
Oh I forgot to mention that the cheap loans from govt to retail banks have finally stopped. Hence recent rate rise to get real people to deposit their money..
Note that the credit rating isn't has high as the main banks. I see Rabobank do 5.75 for 12 months.
Also via Investnow ANZ 6 month rate is 5% which I think is pretty good.
Rabobank is AA-, have 5.2%, and a minimum of $1000. Way less likely to fail. And when I say 'way' I mean waaaaay.
You can now get 5.2% for 6 months with Rabo now. So better than this rate, and Rabo has a higher credit rating. IANAFA
That's a good price. If you pay more than 28 percent tax, I'd recommend looking into pie term deposits as you gain a good edge on standard tax too.
Big thanks to good deals for the bnz price match option.
welcome.. May be a good idea if any of us got a good deal (beyond advertising) could post either as a deal or in the forum. Cheers,
With BNZ, they have online only deals for TDs which you can only see in your account.
Rabobank is 5.2%. $1000 minimum instead of 5000.
SBS 12month 10% https://www.sbsbank.co.nz/invest