Investment objective (after fees and taxes over rolling 10-year periods)
Provide a pre-determined rate of return on investments held for a 12-month term.
Most suitable for members:
wanting the certainty of a pre-determined investment return over a short term but who are not using it as a long-term strategy to build retirement savings; and
not wishing to withdraw the amount invested as a cash lump sum or switch to another investment option prior to the maturity date.
* This option may not suit the member’s particular objectives, financial situation or needs. It has a short-term focus and, on its own, is generally not suitable as a long-term strategy for building retirement savings. It should be used on the advice of a financial planner as part of an overall investment plan tailored to the member’s circumstances.
Minimum suggested investment timeframe
Standard Risk Measure
Risk Band: 1
Risk Label: Very Low
Risk versus return
Provides the short-term security of a predetermined interest rate but no capital growth. As the interest rate is fixed for the term of the investment, investors will not be able to take advantage of any interest rate increases during the term of the investment.
There is little risk of a negative annual return or capital losses. These could only occur in the extremely unlikely event that the underlying investment manager, either an Authorised Deposit Taking Institution, or a life insurance company, fails to provide the interest rate or fails to return all of the amount invested.
Members cannot access their investment during the 12-month term other than in exceptional circumstances.