Exploring your options with debentures upon retirement or retrenchment

investigating your options for retirement or retrenchment with debts

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When it comes to money, always seek the advice of a financial advisor.

Paul Roelofse, a licensed financial planner, and Gugs Mhlungu were conversing.


Roelofse advises familiarizing yourself with the terms and conditions that come with your investments if you are planning retirement or retrenchment and have a debenture with an organization.

” Debentures are financial instruments with various terms and conditions, and one common condition is their termination upon retrenchment or retirement of the holder ,” according to Roelofse’s blog post.

When you’re retiring or being retrenched, he says there are several options to think about, including redemption, conversion, and secondary market selling.

Pixabay.com image
Pixabay.com image

According to Roelofse, the options are listed below:

Redemption

You receive the debenture’s principal amount as well as any interest that has accrued up to the redemption date when you choose to redeem.

Conversion

According to the conditions outlined in the debenture agreement, some bonds offer the option to be converted into company shares.

Secondary market sale

By doing this, you could potentially receive a market price that will change depending on supply and demand dynamics.

A bond and a debenture are similar. It sort of fits into the investment category where you will receive a loan with an agreed-upon interest rate.

Certified financial planner Paul Roelofse

Naturally, there are risks involved because everything depends on the company’s ability to keep up with its obligations under the debenture.

Certified financial planner Paul Roelofse

Roelofse advises speaking with a financial advisor to help you choose your investments wisely.

To hear the entire conversation, scroll up.

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