The fixed term It’s one of the easier instruments to operate Y yields a return that is known at the time of incorporation, turning it into one of the favorite investments of Argentine savers next to dollar hoarding.
To reduce the demand for the latter, the government has increased the rate of fixed terms for encourage this instrument of savings in pesos.
How much do I earn if I put 100,000 pesos in a fixed term?
Currently, the nominal annual rate is 75%. In case it is decided reinvest the money every 30 days, you get a effective annual rate much higher (107.05% per year).
In the case of invest $100,000 at 30 days with the current rate, it will generate approximately $6,164.38 of interest. In the hypothetical case that we invest that money for 30 days, but it is constantly reinvested, after 12 months we would receive $207,050, $100,000 of capital and $107,050 of interest.
In the case of choosing another fixed term rate, we can choose the option fixed term UVA. In this case, the money we invest is divided into UVAS (purchasing value units) and at the end of the fixed term, they will pay us GRAPES which we acquired plus 1% interest.
The fixed term UVA follows the evolution of inflation
There is also the option of fixed term UVA Precancellable, but, in case of canceling it in advance, you will not receive the revaluation of GRAPES, Rather, the money invested will be taken and multiplied by a lower rate than the traditional fixed term.
How much do you pay for a 30-day fixed term in 2022?
In these moments, the fixed term rate is located in a 75% annual nominal and the effective rises to the 107.05%.
Depending on the money we invest It will be what the bank will pay us.
For example, if we decide to invest $200,000 in 30 days With this rate, it would generate approximately $12,328 in interest. In the hypothetical case that let’s reinvest that money every 30 days for a year, at the end of the 12 months we would obtain $414,100 of which $200,000 will correspond to the capital invested and $214,100 of interest.
However, this interest would be “nominal” because, in one inflationary economy like Argentina’s, must be discount inflation for that period to find out what was “real” gain we made. Assuming that to inflation is 90% per year and the fixed term that we constituted, we were withdrawing the interest generated, we will have obtained a loss of 15% per year.
If on the contrary, we renew interest periodically, that is, every 30 days we renew both the capital and the interest, we would obtain the previously mentioned rate of 107.05%. In this case, taking 90% inflation as data, we would obtain a profit of 17.05% in pesos respectively.
What is the monthly rate for a fixed term?
The nominal rate for a 30-day fixed-term deposit, as long as the amount is less than $10,000,000, it is 6.25%.
In the event that the total is reinvested, that is, both the capital and the interest, the money that is obtained on a monthly basis increases thanks to compound interest, that is, interest on interest.
Compound interest consists, in simple terms, of obtaining interest on previously generated interest
For this reason, in the event that, for example, you want invest your money for a fixed term of one year, It is not convenient to do it directly, since you will only charge the nominal rate of 75%, so it is better to renew it every 30 days, obtaining a much higher interest.
In cases where the deposit is for an amount greater than $10,000,000, both the nominal annual rate as the effective annual rate they decrease considerably. This is because the BCRA established a minimum rate policy for those fixed terms that do not exceed that figure and that it is about human persons.
For this reason, in the hypothetical case that you have money greater than u$s 10,000,000, it is convenient divide it into different financial entities for hold interest rate previously mentioned.
With respect to fixed terms UVA, the value evolves according to the increase in average square meter under construction and it is usually identical to the evolution of inflation.
pay a Additional annual nominal 1% on the amount invested, so always beats inflation and decreases the impact of an eventual rise in the dollar, since it tends to rise when there is a high inflation, decreasing the purchasing power of the national currency.
