Daily money with NAO: Your flexible and secure investment

In today's time of financial uncertainty, investors are looking for secure and flexible ways to invest their money. This is where overnight money comes into play — an attractive option for anyone looking for a low-risk investment with daily availability.

But what exactly is overnight money and why is it so popular with savers? In this article, we'll take a look at the Basic principles of the call money account, its advantages and the current situation of overnight interest rates.

Table of contents:

• What is daily allowance?
• The NAO offer: An exciting alternative to the classic call money account
• Comparison: NAO versus traditional overnight money offers
• Tabular interest rate comparison: NAO, other banks and neo-brokers
• Tips for choosing the right call money account
• Conclusions: Which call money account is right for you?
• Conclusion: The importance of choosing according to individual needs

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What is daily allowance?

Daily money is a form of investment When deposits are held in a special account that offers higher interest rates than a traditional current account. The name “daily allowance” is derived from the daily availability of invested capital without fear of fines or interest losses when disposing of the money, as there are no notice periods.

Unlike a current account Money can only be deposited into the call money account from a current account and payout is also only possible to a current account. For providers of call money accounts, it is attractive that the funds stay here longer than with a current account.

Definition and basic principles

In essence, a call money account is an interest-bearing account that you can access at any time. There is no fixed term or notice period, making it a very flexible form of investment. Based on the current interest rate, interest is usually credited annually or sometimes even monthly.

Benefits of call money accounts

The attractiveness of the call money account lies in its A combination of security, flexibility, and profitability. Key benefits include:

• Safety: Call money accounts are usually secured up to a certain amount by deposit protection funds, which makes them a safe investment. Unlike with stocks or others Asset classes There are also no fluctuations in value here.
• Flexibility: You can dispose of your money at any time without having to accept interest losses due to missed notice periods.
• Profitability: Although call money accounts do not promise wealth, they usually offer higher interest rates than conventional current accounts — and also than traditional savings accounts. In this way, they offer the highest return possible with absolute freedom from risk, especially for private individuals' reserves.

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The NAO offer: An exciting alternative to the classic call money account

The Berliner FinTech NAO offers an unlimited and unconditional interest rate, which is also protected by banks' deposit insurance up to a deposit amount of €100,000. With a Interest rate of currently 2.4% p.a. on settlement accounts NAO is an exciting alternative to a conventional call money account. The average interest rate on overnight money in Germany was Year 2023 at 0.37%. With the new offering, NAO offers an interest rate that is 2.03% higher than the average.

Presentation of the NAO offering

2.4% p.a. on settlement accounts: Details and benefits

NAO offers its customers an interest rate of 2.4% p.a. on the balances of their settlement accounts. This interest rate applies retroactively from February 1, 2024 and enables investors to benefit from an attractive return on their uninvested capital. This surpasses This offer meets the conditions of many traditional banks and brokers and offers an additional opportunity to build up wealth.

The interest rate of 2.4% p.a. reflects the interest rate policy of European Central Bank against. NAO automatically adjusts the interest rate to changes in the key interest rate, but expressly excludes a negative interest rate. This procedure guarantees that customers always benefit from a fair, transparent and favorable interest rate.

Customer-focused decisions: feedback and adjustments

The introduction of interest on the NAO settlement account is a direct result of NAO's commitment to respond to customer feedback. Through continuous dialogue with the community, NAO recognized the desire of many investors to pay interest on their assets.

This request was implemented immediately without demanding minimum or maximum deposits, which underlines the customer orientation and flexibility of the offer.

No minimum or maximum deposit with NAO

Flexibility and availability of funds

One of the outstanding features of the NAO offering is the abolition of minimum or maximum deposits. This means that customers can benefit from the interest rate regardless of the amount of their assets.

The flexibility is characterized by the fact that transactions can be carried out or the money can be paid out again at any time without this having an effect on the interest rate. In addition, the interest is not linked to any obligations, such as the purchase of other financial instruments via NAO, but is paid out unconditionally.

Monthly interest credit and security aspects

NAO pays interest on a monthly basis, which represents a continuous and transparent income opportunity for customers. The transparency of inflows is ensured by viewing the transaction history in the NAO app.

In addition, the balances are kept in the settlement accounts at the German Baader Bank and therefore protected by statutory deposit insurance up to an amount of 100,000 euros.

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Comparison: NAO versus traditional overnight money offers

In a market characterized by numerous offers for call money accounts, NAO can still stand out thanks to its innovative offering. To illustrate the differences and benefits, Let's compare NAO with traditional overnight money offers based on various criteria and in a tabular overview.

Comparative criteria for call money accounts

Interest rates, availability and security

• Interest: The main criterion for choosing a call money account is interest. While traditional banks only offer low interest rates on traditional demand deposits or higher interest rates are subject to conditions, NAO stands out with a guaranteed interest rate of currently 2.4% p.a.

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• availability: A major advantage of call money accounts is the daily availability of money. NAO fits in here and offers unlimited flexibility by allowing access to the entire balance at any time without affecting interest rates.

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• Safety: Deposit security is another important aspect. Both NAO and traditional banking offerings are protected by statutory deposit insurance up to 100,000 euros.

Special features of the NAO offering

NAO differs not only in terms of higher interest rates than traditional banks when it comes to interest on demand deposits, but also by abolishing minimum or maximum deposits, which ensures greater accessibility and inclusivity. The monthly interest credit and the safekeeping of assets at a renowned Deutsche Bank round off the offer.

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Tabular interest rate comparison: NAO, other banks and neo-brokers

To be able to compare NAO's offerings with other offers, Let's look at interest income for various investment amounts over a year:

Status: 13.02.2024 - Calculation by the NAO editorial team.

conditions:

• Online broker A: 4% p.a. Interest for new and existing customers, up to a maximum of 50,000€ with no term limit. Monthly payout.
• Online broker B: 4% p.a. for 4 months (new customer) up to a maximum of 1,000,000€, then 2.6% p.a. or permanently as an existing customer in the subscription broker (4.99€ per month) up to a maximum of 100,000€. Calculate the subscription only.
• Online bank C: For new customers, 3.3% p.a., then 1.25% p.a. up to 250,000€. Annual payout.
• NAO: 2.4% p.a. for new and existing customers, without limitation in terms of term or investment amount. Monthly payout.

Analysis and explanation of results

The table shows that that NAO offers higher interest income than online broker B (new customer) for investment amounts of 159,524.57€ and higher interest income than online broker B (existing customers) for investment amounts starting at 107,146.83€. This underlines the strength of the NAO offering for larger investment amounts.

Online broker A remains the leader for investment amounts of up to 50,000€ with an interest rate of 4% p.a. and monthly payout. It is also becoming apparent that online banks with their offers are not competitive with NAO's offer, regardless of the amount.

NAO therefore has the opportunity to establish itself as a leading choice for investors who want to invest larger amounts of money, and offers an attractive combination of profitability, security and flexibility.

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Tips for choosing the right call money account

Choosing the right call money account can be a challenge, but with the right information and consideration, you can make a decision that best meets your financial goals.

Key considerations before making a decision

Maximum investment and duration

Before you decide on a call money account, You should check the conditions regarding maximum investments and terms. Some providers offer attractive interest rates, but these are only valid up to a specific investment amount or are tied to specific terms.

Special interest rates and conditions for new customers

Many banks attract new customers with attractive promotional interest rates. These can be significantly higher than standard interest rates, However, they often return to lower rates after the end of the action period. It's important to understand these conditions and assess how they impact your investment over the long term.

Additional costs and conditions

Beware of hidden fees and subscriptions

Some providers may introduce additional fees or the need for a subscription, which entails additional costs if you want to continue to benefit from an attractive interest rate. Be sure to read all terms carefully to avoid unexpected costs that could reduce the return on your investment.

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Conclusions: Which call money account is right for you?

Which savers is the NAO offer suitable for?

NAO's offer is particularly suitable for savers who want to invest higher investment amounts and value a flexible, secure and high-yield investment. By eliminating the minimum and maximum deposit and monthly interest credit, NAO offers an option for investors who are looking for an alternative to traditional call money accounts.

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Conclusion: The importance of choosing according to individual needs

Choosing the right call money account depends heavily on your individual needs and financial goals. While NAO is an excellent choice for investors with higher amounts and a desire for flexibility, other offerings may be more suitable for investors with different priorities.

It is crucial to compare offers carefully and to assess both the short-term benefits and the long-term impact on your finances.

Choosing the right call money account requires thorough research and an understanding of the various offers on the market. By following the tips above, Can you make an informed decision that fits your financial situation and goals.