, a free weekly newsletter giving expert tips on how to save, invest and make the most of your money, is sent every Sunday. You’re reading an excerpt −In the grand scheme of all things finance, there are plenty of terms, definitions, and products that are so complex that your average money fan would need significant study to properly grasp. Stuff like zero-coupon inflation swaps, modified internal rates of return, or yacht insurance – all complete nonsense.
However, there’s one term you’ll likely hear every year until the bond reaches maturity in two years, at which point they get back the capital they invested .For the company/government, they get money to fund whatever they need. For the investor, they get a reliable, unchanging source of fixed income for as long as they like. Keep in mind these bonds are – confusingly – different to insurance/investment bonds, which are a type of pooled investment.
Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.