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Wednesday, 17 December 2014 13:13

Save Our Pensioners From Low Rates

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Scan the historic graph below to see how much the retiree living off their nest egg has been disadvantaged by low interest rates in the last decade; indeed, how much more disadvantaged investors have become November 2011. Since the truth is that no one can predict markets or the next interest rate move, and if they could, a 0.25% or 0.50% change in interest rates in either direction, would not make a meaningful difference to investors – alternatives are needed!

Credit Connect Capital likes to support self directed investors by providing term investments that yield between 7.00% p.a and 9.50% p.a. Below we discuss an alternative way for investors to diversify, generate income, and exercise choice.

 

Term Deposit Rates

The Reserve Bank of Australia noted how many people over sixty have turned to investing directly in residential property by gearing. But will the resulting rental collections provide enough income in retirement?

The RBA has consistently stated they would like to see housing construction strengthen to meet the dwelling needs of our growing population and to support the Australian economy’s transition away from mining.  Persistent low cash rates will help the construction sector, but developers still struggle obtaining adequate financing. Investors can step in and fill the funding void.

Credit Connect Capital helps investors find first mortgaged secured construction loans, with loan to value ratios below 66.66%, that can yield over 8.0% p.a. Investors get to select the investment in which they participate.

 


Financial Stability Review, September 2014, RBA, p50. http://www.rba.gov.au/publications/fsr/

Glenn Stevens, RBA Governor, Full Transcript of AFR Interview, Published 11 December 2014  http://www.afr.com/p/national/rba_governor_glenn_stevens_calls_bj9xpmXwjU4LxWSSfLE7nM

Last modified on Thursday, 18 December 2014 10:23

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