Term deposits 'good for short-term investments'

Investing in term deposits may be an effective and safe way for Aussies with some spare money to store their cash and accrue interest, it has been suggested.

Writing in a question and answers piece for Business Day, director of Whittaker Macnaught Noel Whittaker noted that those who plan to access their cash within nine to 12 months should consider this savings option.

When asked for a way to minimise tax and to recommend a short-term low or no-risk investment option, he replied: "The only realistic option is term deposits."

He added that couples might be able to reduce the taxes they pay by investing in the name of the one with the lowest income.

This comes after AMP Capital's head of retail distribution Ben Harrop told the Financial Standard that term deposits are proving attractive to cautious investors seeking to minimise the risk their cash is exposed to.

The expert observed that with rates of up to 6.5 per cent available, these are particularly attractive options to savers in Australia.

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