Investing in bonds

Posted: September 10th, 2013 | Author: | Money, Savings

The most widely promoted safe investment product or investment is policy-place. It is just the most popular and according to many people it is the safest way of investing money. It turns out, however, that is not the case.

marfis75 / photo on flickr

marfis75 / photo on flickr

It is much safer than other similar investments or insurance policies, because they are bonds issued by the State. What exactly are bonds? These are securities which are dematerialized form which means that there is no risk of lost or stolen bonds. How do bonds work? You issue a receipt to a kind of debt that after a certain time is required to purchase from us with interest. Interest is fixed or variable, depending on what bonds we purchased. Details of the specific types of lists are available in the issue.

You should know that it is the guarantor of the bonds treasury. It is a much safer alternative than deposits with banks or insurance companies. Mainly because even though the insurance companies and banks go bankrupt very rarely, it happens more often than a bankruptcy of the state. Each bond issue is accompanied by a letter which contains mainly information on the interest rate, the terms of issue and the date and place of purchase.

 

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