Diversifying your funds is well-established advice for investors, especially when faced with low term deposit rates offered by major banks. In this blog post, we delve into the changing landscape of investment opportunities, considering recent statements from the Reserve Bank of New Zealand (RBNZ) and the potential implications of zero or negative interest rates. We also explore how investors can seek higher returns while supporting the economy and ensuring a quicker recovery.
RBNZ’s Perspective and Low Interest Rates
Following the release of the Financial Stability report, RBNZ deputy governor Geoff Bascand emphasised that despite uncertainties, New Zealand’s financial system remains resilient in facing the impact of the pandemic. However, Bascand also anticipates that interest rates will remain very low for an extended period. Recognising the effects on retail investors, he highlighted the need for savers to explore alternative areas to allocate their funds.
Impact of Low Deposit Rates and Diversification
The discussion around zero and negative interest rates has gained attention among economists, market commentators, and the RBNZ. While declining deposit rates benefit borrowers by reducing the cost of funds to banks, it poses challenges for savers. The decline in deposit rates encourages investors to consider other options that not only offer higher returns but also contribute to the economy’s recovery. Diversification, the certainty of savings, passive income, and higher returns are important factors to consider in this changing landscape.
Exploring Norfolk Mortgage Trust as an Alternative
Amidst the uncertainty, many investors have shifted towards conservative investment options away from the share market, resulting in reduced returns on their investments. Term deposit rates offered by the four main trading banks for the next five years range from 1.85% to 2.0%. This has significant implications, especially for those reliant on term deposit income.
Norfolk Mortgage Trust: A Conservative Investment Option
If you are considering diversifying your portfolio, Norfolk Mortgage Trust offers a compelling alternative. We prioritise the consistency & stability of returns for our investors’ investments over maximising returns, ensuring confidence and peace of mind for our investors. Investing in Norfolk Mortgage Trust’s property fund is an excellent option for investors seeking to earn passive income from a property-backed investment with minimal effort.
Get in Touch with Norfolk Mortgage Trust
If you have any questions about investing with Norfolk Mortgage Trust or want to explore the potential benefits of diversification, please feel free to contact us at email@example.com or 09 303 1525. Our team is here to assist you in making informed investment decisions and navigate the evolving investment landscape.