Low interest rates are not good for savers but present opportunities for investors
The Walton Financial Group in Barrie Ontario has experience guiding investors in a time of low interest rates
The interest rates lenders charge and that investments pay are pegged to the Bank of Canada rate. In the face of economic concerns related to the COVID-19 pandemic, Canada’s central bank lowered its key interest rate three times in 2020 to a current level of just 0.25%. While that’s not the rate of interest you will earn on your savings or pay on your debts, it does impact those consumer rates and the economy as a whole.
So low interest rates have become a fixture in finance. While the scenario creates advantages for some — companies and people taking out loans, or seeking to refinance their mortgages — it can be a problem for others:
Consult with the financial planners at the Walton Financial Group in Barrie Ontario and get some expert advice about ways to secure investments to obtain higher returns on your savings than bank interest provides.
There are a couple of key principles involved here:
- 1. A certain amount of volatility is baked into the market, and the best course of action is to stay invested for the long-term rather than lock-in investment losses by selling.
- 2.For new investment purchases, go slowly and spread them out as monthly automated contributions. This will help you avoid the risks of trying to time the market.
- 3. Diversify your portfolio. That means choosing investments across a variety of sectors (e.g., retail, real estate, energy, tech, healthcare, financial services, utilities), different global markets (Canadian, US, international) and with a balance of asset types (equities, bonds, etc.). That way, if one sector, location or asset type performs poorly, other investments in your portfolio will hopefully offset those losses.
The most important thing is get comfortable with a financial advisor that you can trust and the Walton Financial Group in Barrie has hundreds of Testimonials from satisfied clients who have benefited from their relationship with this experienced and reputable firm. Click the link below to see how others feel and then call to make an appointment
