5 Best Short Term Investments in UAE

Short-term investments in UAE are a great option for investors who might need access to their fund in the short-term, but still they want to make money. Typically, short-term investment is expected to grow and give a viable return within a few months or years. 

There are multiple options for short-term investments. These investments are an excellent option if you want to embark on a rewarding journey to financial freedom.

When you want to protect your cash for productive use in the future, taking up a short-term investment is an ideal option. With good investment strategies, there is minimal loss, and your money will grow fast enough to achieve your goals.

You must ensure that you choose quality short-term investments. These have the following attributes: 

• Stability – Short-term investments have a small historical risk of losing money, unlike stocks where volatility can lead to financial ruin.
• Liquidity – It is quick and easy to gain access to your investment turning it into cash when you need to. Other investments such as Real Estate are not liquid.
• Low Cost of Transacting – Getting into or out of the investment is low in cost, usually close to zero.

For investors, “long-term” investments typically take several years, and in some cases, decades, so that they can mature. Short-term investments will last only for a few months, to some years, often up to five.

There are a number of short-term investments in the UAE that you can choose from. Decide on which one is the best fit for your particular situation and preferences.

Here are 5 best options for short term investment in UAE:

1. National Bonds
2. Crypto Staking
3. High-Yields Saving Accounts in UAE Banks
4. Short Term International Bonds
5. Pay-off High Interest Debts

Read More: 8 Ways How to Invest in UAE: Investing Guide

1. National Bonds:

For many investors, it is essential to choose a highly secure investment option. One of the safest investments that are available in the UAE is the type that is controlled or issued by the government. 

Once the bond reaches its predefined period or maturity, investors are able to get back the total amount that they invested in the bond. 

A key benefit of choosing National Bonds is the minimum amount required to start investing. Investors can begin investing with as little as AED 100. There is also flexibility since the funds invested can be redeemed at any time.

Bonds will have a predefined period of between a year and 20 years. In addition, there are multiple options to choose from including saving bonds. If you are interested in an option that is more short-term, you can redeem a bond after 30 days. 

FAQs 

How can I apply for National Bonds?

There are more than 550 outlets, leading exchange houses, and banks that have National Bonds available. You can purchase them by visiting these outlets, or for convenience, you can choose to purchase them online. Online purchases can be done through www.nationalbonds.ae. Alternatively, call the direct sales team using the number 600 522 279.

Do I need identification to apply for National Bonds?

Yes, you need identification. UAE residents may apply with a True Copy of a valid Passport, along with the Visa page or Emirates ID. Visitors or non-UAE residents require similar identification, a True Copy of a valid passport with the Visit Visa Page / Entry Stamp.

Check out: Everything you need to know about National Bonds of UAE

2. Crypto Staking:

There are several crypto that are paying very high returns for simply buying the coin/token, and staking it.

Staking is very simple and you can do it from the comfort of your mobile phone. You can get high returns on your money by locking it for a period from 1 week to 1 year, depending on how much you are willing to lock your funds.

However, If you have kept away from purchasing Crypto because it’s volatile, you can still buy USDT coin which is almost equal to 1 USD for 1 USDT. For example, for USD 1000 you can get 1000 USDT, and staking it through Binance can pay you around 6% annually.

Staking is when you actively participate in transaction validating which is similar to mining. Skating is done on a proof-of-stake (PoS) blockchain. On these blockchains, anyone with a minimum-required balance of a specific cryptocurrency can validate transactions and earn Staking rewards. 

Read More: Best CFD Brokers in the UAE (2021 Update)

3. High-Yields Saving Accounts in UAE Banks:

Savings accounts in UAE banks and off-shore offer a modest return on your money. Most saving accounts from banks offer less than 1% interest. 

However, using a bank for your savings is a better option than leaving your money with no interest in current accounts.

To get the best interest rates, always search for digital banks. These types of banks run most of their operations using artificial intelligence and chatbots; therefore, their operating cost is low. They can afford to provide high interest on saving accounts.

For example, Liv bank is a digital bank owned by Emirates NBD that pays an interest rate of 1.5% per annum for a savings account, which is considered very high compared to other banks in the UAE and even globally.

Read More: 5 Best Forex Brokers in UAE (2021 Update)

4. Short Term International Bonds:

It is possible to purchase short-term international bonds and benefit from growing markets outside the UAE. One of the most popular options is investing in bonds from the US, particularly because they are viewed as highly safe. In addition, they are easily available through online platforms.

How to invest in International Bonds from UAE: Check out How to Invest in Bonds from UAE

5. Pay-off High-interest Debts:

Your high-interest debt could have a negative effect on your efforts to get a return on your investment. Therefore, you need to eliminate this debt as quickly as possible. Pay off your high interest to save on costs.

For example, you may have a credit card with a 15% interest rate and a $10,000 balance. When you pay off this debt, it is similar to receiving a 15% return on the balance amount. Here are some strategies to help you achieve this.

Transfer your debt to a 0% APR credit card

This option allows you to take on a credit card that charges 0% interest for a fixed period of months. This allows you to spread out your payments on high-interest balances and this gets yourself out of debt. The benefit is the savings you will make on interest, and helping you build up your financial discipline.

Some banks in the UAE offer interest-free credit cards such as HSBC.

Take a personal loan

It may seem counterintuitive to take out a personal loan in order to bring down your debt. However, this is an excellent strategy for consolidating your debts. With a personal loan, you can pay off your high interest debt faster, and create a structured payment plan that brings down your monthly minimum payments.

Opt for drastic action

This calls for becoming highly disciplined when it comes to managing your debt. Ideally, taking drastic action requires you to cut down your expenses and use up the available funds to pay your high interest debt faster. By evaluating your debt, you may find interesting opportunities such as eating in more than eating out, using public transport instead of your car, and so on. Evaluating how you spend could make an incredible difference to the funds that you have available for paying off debt.

If you want to have a discovery call with one of our recommended financial advisors, drop us an email on info@thefinancedean.com

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Conclusion:

There are excellent investment opportunities available in the UAE, particularly for the short-term investor. Before choosing which one you prefer, you need to have two main things in mind – how long you want to invest for, and how risky you want your investment to be. One benefit of a short-term investment is being able to retrieve your funds when you need them. In addition, you can also choose the type of payout that suits your needs, such as receiving interest payments twice a year with bonds or converting your returns into cash at the end of the investment period.

Make an informed decision by spending time seeking advice from a specialist. This is the best way you can discover the best options to choose from.