The end of the year is approaching and, with it, comes the long-awaited extra pay. According to the Workers’ Statute, each worker has the right to two extraordinary bonuses a year, one of them on the occasion of the Christmas holidays. And although the law also allows extra payments to be prorated over twelve monthly payments, there are many Spaniards who will have an additional income this December.
For the specialists of the financial comparator HelpMyCash.com, this can become an opportunity to grow wealth. “Taking advantage of this extra income intelligently can make a difference in long-term financial health,” they say. Therefore, they propose three intelligent ways to invest the extra pay and obtain returns in the short and medium term.
A conservative, but effective strategy is to opt for one-year deposits, which today offer remunerations higher than 4% APR. “Fixed-term deposits are ideal for those looking to preserve their capital while obtaining consistent returns,” they say from HelpMyCash. And there are deposits that require a minimum investment of around 500 or 1,000 euros, which allow you to easily make the extra pay profitable.
The Estonian bank LHV offers a one-year deposit with a profitability of 4.15% APR. The minimum investment is only 500 euros. Fjord Bank, for its part, offers 4.10% APR with a minimum investment of 1,000 euros. “These deposits are from banks in other European countries, but they can be easily contracted from Spain through the Raisin platform. In addition, they are protected by the Guarantee Fund of the country of origin,” say the HelpMyCash experts.
Those looking for an option with returns greater than 3% and with the possibility of withdrawing the money at any time, monetary funds are another option to consider. These are low-risk investment funds that invest in very short-term fixed income products, such as Treasury Bills, deposits or company promissory notes. Their profitability tries to get closer to interest rates and, although they have not had enough publicity in Spain, “monetary funds are the preferred product of Americans when interest rates are high, like now,” they explain from HelpMycash.
The InBestMe savings portfolio, for example, gives an expected return of up to 3.50%. Its risk is just one out of seven, according to the Securities Market Commission (CNMV). And although it does not require requirements, deadlines, or capital limit, to opt for this fund you need to make a minimum investment of one thousand euros.
Another option is paid accounts, which, although they give lower returns (around 2%), allow you to withdraw the money at any time and, since it is a bank account, the risk is practically zero.
The N26 Savings Account is one of the most profitable at the moment, because it offers returns of 2.26% APR with no maximum amount. It does not charge commissions or require requirements and is protected by the German Guarantee Fund.
Sabadell, for its part, markets its Online Account without commissions. Its profitability is 6% TIN for the first three months and, afterwards, it gives 2% TIN (3% APR), for a maximum balance of 20,000 euros. It also returns 3% of electricity and gas bills.
“The extra pay can be spent or saved in the bank, but neither case contributes to growing assets. If you want to do things differently, taking advantage of the returns that the market offers is a good way to start multiplying savings”, conclude from HelpMyCash.
