With interest rates on bank deposits at an all-time low, it can be frustrating to see such low returns on your company’s money.
In fact, according to research from Aviva, 68% of Irish companies are dissatisfied with the interest rate they receive on their bank deposits, while more than two thirds of Irish companies are not even aware of the interest rate they are earning on their deposit.
While your company may need to retain funds in a bank deposit to meet short-term cash flow needs, it is important to understand how your funds are affected if inflation is greater than the interest your deposit earns. In this case the real value of your deposit may fall.
Corporate savings or investment products have the potential to generate much higher returns than a typical bank deposit account. By investing your money there is much greater growth potential, particularly in the longer term. There are also a range of benefits that apply to corporate investments. For example, returns that are only taxed on withdrawal, assignment, every eight years or on death. This means taxation doesn’t impact your investment growth each year and gives your funds the opportunity to benefit from compounding.
To learn more about corporate savings and investments and to see if they are a fit for your business, watch this video from Aviva and get in touch with a Hennelly Finance qualified financial advisor today on 091 670 123.