Certificados de Aforro (savers certificates) are a low-risk investment option for saving money.
It is critical that you are aware of your possibilities for better money management at a time when saving money and figuring out how to deal with rampant inflation as well as rising living expenses are hot topics. For many Portuguese people, saver certificates, for instance, are a way to save money. Here, we describe what Certificados de Aforro are and how they work so you can decide if they are appropriate for you.
What are they?
Savers Certificates are guaranteed by the State and are a risk-free investment, and it is categorised as a public debt product, which has minimal risk and high liquidity.
For individuals who sign up for this kind of service, these certificates give permanence premiums in addition to interest with quarterly capitalization. Due to their restrictions, it is a more alluring form of savings than normal savings but it is only available to individuals.
Purchasing Saving Certificates
First off, you should be aware that only a private individual can obtain this kind of title, and there is no age limite. These make a good Birthday or Christmas presents for children.
Savings certificates can be acquired through the IGCP service, E.P.E., the AforroNet system, CTT stores, or citizen space counters, among other places.
For face-to-face requests, you will need to create an account with the aforesaid organisation, complete Form 701, and present a few simple documents to verify the process:
Personal identification;
Tax identification;
Evidence of a bank account (bank statement)
Proof of address;
and evidence of one's occupation and employer are all required.
What is the minimum investment you can acquire?
100 units are the required minimum for each purchase. The initial investment for any savings certificate is always at least 100€, with each unit having a value of one euro.
But there is a maximum just as there is a minimum. You can only purchase a total of 250,000€, or 250,000 units, per person.
How much does it yield?
First of all, it is important to reiterate that this savings option is the least risky one available because it is tied to the State. Additionally, this security permits quarterly interest capitalization, which is followed by a period during which you may always redeem the add-on certificates and get your money back plus anything you have previously invested.
How do you redeemed these Certificates?
Depending on the type of series, different certificates must be redeemed. There are currently five series, each with unique qualities and varying methods of money rescue, which are as follows:
Series A and B aphore certificates, which have no required cooling-off period and may be held for as long as the holder pleases;
Income certificates from Series C, D, and E are repaid with capital and capitalised interest on the tenth anniversary of the subscription value date. The invested capital is immediately credited to the bank account linked to the account holder's account on the date specified.
Take note that these securities are likewise ineligible for settlement for the first three months following the purchase.
You can always request the amortisation of these certificates after the first three months, but the interest accrued from the previous capitalization and the redemption date is not included in the amount you would withdraw.
The holder must make the request to redeem the certificates, and the money will be transferred to the bank account linked to the certificates.
One more crucial point: while it is possible to partially redeem your add-on certificates, you can never have fewer units remaining than the minimum subscription amount, which is 100 units.
What distinguishes these saving certificates from treasure certificates?
There are various variations between savings and treasury certificates despite the fact that they are both types of savings connected to the low-risk State, particularly in terms of the original investment, interest capitalization, redemption of certificates, and profitability.
Treasury certificates with a savings value require an initial investment of at least 1,000€ and a maximum of 1,000,000€s, with yearly interest capitalization, or every 12 months. There is also a one-year waiting period before redeeming the certificates' value.
There are distinctions between the Saving Certificates and Treasury Certificates in terms of profitability.
It is crucial to thoroughly research all available information, compile financial statements, and select the best course of action in each situation before making a choice.