What investment return can I expect on a term deposit?

When you’re looking for a great return on your investment, look no further than a fixed-term deposit. Unlike shares, stocks, or standard savings accounts, this easy-as investment option works harder to offer kiwis like you the maximum possible return on the money you make today, for the future you’ll be living tomorrow.

In fact, there’s never been a better time to invest your hard-earned savings with credit unions like NZCU Baywide, who currently offers some of the highest returns on investment in New Zealand.

With great rates like these, what kind of return can you expect on your investment? To find out, simply use the investment rates listed below:

Term   Investment rate
1 month 1.50% p.a.
2 months 1.50% p.a.
3 months 2.95% p.a.
4 months 3.00% p.a.
5 months 3.25% p.a.
6 months 3.50% p.a.
9 months 3.55% p.a.
12 months 3.60% p.a.
18 months 3.70% p.a.
24 months 3.90% p.a.
36 months 4.10% p.a.
48 months 4.25% p.a.
60 months 4.30% p.a.

Things you should know about investment rates and your returns

> Interest is calculated on a daily basis

> Investors are advised of their options prior to maturity

> Maximum deposit $1 million per member

> Minimum deposit is $1,000 for adults and $500 for children under 18 years old

> These are indicative rates only and may be subject to change without notice

> If an early withdrawal is approved by NZCU Baywide, a reduced rate of interest will apply as follows:
a) If a term deposit is withdrawn, in full or in part ,within the first 30 days, 0% interest will be applied to the withdrawn portion.
b) Where the term deposit is withdrawn, in full or in part, before the maturity date but after the first 30 days, a reduced interest rate will be applied calculated using the advertised rate at the time the term deposit was opened, for the actual term the money was invested (as determined at our discretion), less 2%. The applicable interest rate will not reduce below 0%.

Do you want to invest in your future with an NZCU Baywide term deposit? Apply online for a term deposit today

An example of a term deposit in action

Name: Jacob
Nationality: New Zealand
Age: 45
Income: $33,000
Tax Rate: 17.5%
Occupation: Dairy Farm Owner
Scenario: 

Jacob has spent most of his adult life working, from his early teenage years delivering papers right through to his role as owner and manager of a small dairy farm just outside of Napier. Jacob loves his farm, but his stiff joints, nagging aches, and niggling pains are telling him his body thinks otherwise.

When considering retirement within the next 10 years, Jacob realises he hasn’t always been the best at saving money. Like most of us, he’s had his fair share of loans, debts, and other emergency expenses crop up over the years which have all taken a bite out of his nest egg.

Having compared the savings accounts and term deposits available, Jacob decides to apply for a term deposit. By investing the money he’s saved over the years, Jacob hopes to boost his retirement savings, supplement his KiwiSaver, and ensure he can enjoy retirement when it comes around free from worry and stress.

How did investing for a fixed term help Jacob save?

Upon opening his term deposit, Jacob deposits $10,000 for a term of 5 years (60 months). With the way term deposits work, as long as Jacob doesn’t withdraw any money before the maturity date he’ll have a guaranteed rate of 4.30% p.a. (the rate available at the time of his investment) locked in for the life of the investment.

With interest compounded monthly and reinvested, by the time Jacob hits 50 years old and the loan reaches maturity, he would have turned that initial investment of $10,000 into $11,937.74 (after tax). That’s an additional $1,937.74 in the bank simply for choosing a great term deposit investment and letting his money do the work for him.

*This example is intended as a guide only. All interest rates and fees quoted are subject to change. View a full list of rates and fees here. If you’d like to know more about how you could benefit from the high returns of a term deposit, contact us for more information or to speak with our team.


Want to know your options?

Learn about fixed-term deposits