As above really!
Basically, I'm currently getting about 1% interest on my savings.
Surely?! I'm better off putting a chunk of this money (which I shouldn't need anyway) into this for 14 months?
I like low (well NO!) risk, so Im not into shares etc,
Sounds like a no brainer to me? What do I know though! Of course interest rates are looking like they are going to rise and rise! So what would you do?
As long as your money is protected and you definitely don't need it, that seems pretty good. I guess you've got to keep in mind that (a) you aren't really on the best interest rate currently for an instant access current account....Chase offers 1.5% AER on balances up to £250,000 (although thats well over FSCS limits) and (b) interest rates are only going one way at the moment, so in 6-12 months time, that instant access current account rate might be higher than 1.5%.
I’ve opened a chase one - not bad- the max £85k pays about £92 a month interest
Best other interest rate I can find is Club M Saver from Virgin Money...1.56% up to £25,000.
I guess with 10% inflation, all of these are the equivalent of putting a finger in one of the holes of your bucket whilst the contents stream out the other holes!
Have you then got 40% tax to pay on the interest?
RIAC
No its 2.35% after tax (AER gross per annum). AllegedlyOriginally Posted by 100thmonkey
You cant get the money out in the interim though. As I shouldn't need the money in that period , it doesn't really bother me anyway.
I’m sure you will pay tax on that as well. Remember it looks like rates are only going one way at the moment so you may lose out rather than a 1 year fix
Yep that's a fair rate, would have been about 0.6% 12 months ago. In a years time it may well be about 3.5% for 12 month bonds
Have you checked out here https://moneyfacts.co.uk/savings-accounts/
No savings interest is taxed at source and you will have your Personal Saving Allowance, so maybe no tax due depending on your circumstances https://www.moneysavingexpert.com/sa...ngs-allowance/
Back in the seventies when inflation was rife, no one with any sense invested in fixed rate accounts because what is the point of being paid 2.35% when the money is being devalued by 8%.
Commodities and rare things became the sought after investments and they usually did the job by beating inflation.
Surprised to see one year fixed rate of 2.6%!
https://www.moneysavingexpert.com/sa...best-interest/
and with a regulated bank so protected to £85,000.
I can’t reconcile “after tax” with “AER gross”.
Can you provide a link?
Its with the Coventry building society.
Good news then it’s secure (to £85,000) but that is the gross rate.
Per my link to Martin Lewis site, you can get 2.6% for 12m. Coventry’s 2.35% appears to be annual rate so you’ll get very roughly 14/12x2.35% = 2.74% for the 14m.
Ah,
Thanks for that.
I did look on the site, I already have some money in the Coventry. I looked on their site today , and saw the product, then looked on the website you mentioned. I will probably transfer some money over into the 2.35% . Its about double what I'm getting now anyway!
Ive always wanted to retire at 60 or earlier....I remember years and years ago! "banking"on getting 3%-5% interest easily, on any money I had when I retire....
How times have changed!
No worries. Careful what you wish for. We could be heading for interest rates of 3%+ but with inflation eating into the real value of your savings.
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