My cash ISA statement was in the mini-backlog of post delivered today.
It tells me the near three thousand quid in the account has earned the princely sum of £14.28 in interest in the last year.
Surely I could do better than that?
I have instant access to the money, but I would be prepared to lock it away for, I dunno, up to a year, if it meant a decent return.
The ISA is with NatWest and is effectively 'no risk".
I imagine I'm going to have to accept some risk to achieve a significantly better return.
That's OK by me, but what I'm not going to do is invest the lot in the next Polly Peck.
I'm aware some members are rightly wary of being seen to offer investment advice, but I can assure you any suggestions will be taken in the right spirit.
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I took a "flutter" with my 09 and 10 ISA allowances with the equity market - the 09 one has made around 20% the 10 one not so well. Principality BS have a 4.1% bond if you want safety.
More fun buying a Mac though iffy rather than saving it !
Last edited by: Pugugly on Thu 9 Dec 10 at 15:54
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...More fun buying a Mac though iffy rather than saving it !...
There's not much incentive to save for the disinterested saver such as myself.
When you say equity market, I take it you mean an equity market linked ISA which I could buy from a bank or building society.
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Thinking of buying a few shares in Lloyds Bank myself. Not suggesting that you should do the same, of course.
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you can get between 3 & 4% (pre tax) in savings accounts if you lock it away for a year.
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...you can get between 3 & 4% (pre tax) in savings accounts if you lock it away for a year...
So that's, what, roughly a hundred quid?
Not a fortune, but a lot better than the pittance I'm getting at the moment.
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I put a wedge in a 3 yr bond with Saga. It produces about a tenner a day. I've got just under two years to run and then if I'm only getting 1%, we'll probably fritter it away. It'll last us into our early 80s and by then we probably won't have a car or some of todays expenses to worry about.....certainly not 3 cars and a couple of bikes.
If we live that long of course. I
We're not bothered about leaving money to the kids, they'll have the house to split between the three of them.
Ted
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...about a tenner a day....
A tenner a day - that's nearly a pension, as Tony Hancock didn't say.
Must be some wedge that, Ted.
Well out of my league.
Anyway, isn't SAGA for old people? :)
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>> ...about a tenner a day....
>>
>> A tenner a day - that's nearly a pension, as Tony Hancock didn't say.
>>
>> Must be some wedge that, Ted.
Btween 180 and 200k I would say.
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When we put our proceeds from selling the house into a savings account I was probably getting about £220pm interest after tax. That was in an instant access type account because we couldn't lock the money away for a year or more - we had a house to buy. I still have about £7k in the same account and it gets nowhere near the same interest rate.
Job for over Christmas is to research where to put the savings. So this thread could be interesting. We'd be able to lock it away for a while too.
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Post Office have a good instant account - also an over 50s SAGA account is a best buy.
Yes iffy it was a brace of ISAs
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Manage 50 yrs and you're in Saga'sights , Iffers.
They use B'Ham Midshires. I want it to be accessable when the bond finishes so I'll take a hit on interest I wish, Z. it's only money and you only get one life so I'm in favour of using it for a more comfortable life...when it's needed.
Ted
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Instead of saving like a mad one i make over payments on the mortgage as this is light at the end of the tunnel & the interest on the ISA is not going to pay much of a holiday.
39 now want it paid off in 4 years & been making over payments the last 12 months.
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Common sense approach BT - reduce your liabilities as they will generally cost more than what saving earn.
Last edited by: Pugugly on Thu 9 Dec 10 at 16:55
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...Instead of saving like a mad one i make over payments on the mortgage...
Very wise, it is bonkers for anyone with a mortgage to keep anything more than a rainy day fund as savings.
Those that do are effectively borrowing their own money and paying lots of interest to do it.
I don't have a mortgage, but neither do I have much in the way of savings.
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I do have a bit of savings but they are just my get out of prison card. The taxman takes them all away from me each year but in 2011 I really want to pay off my credit card (£1400) and save £100 a month extra.
The problem is my parents situation is so dire that anytime I have spare money they ask to borrow it which I will get back when they get some inheritance money which could be in ten years time (hopefully and not before).
I think my problem is money dosn't really doing anything for me.
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I have been wittering on for ages that mortgage rates will go up, ok it hasn't happened as soon as I thought, but they still only have one way to go and they will get their in third gear believe me.
Mortgage free is life free in my book. I had a wedge, enough to buy a buy to let property, but getting my own debt off my back was key.
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I think my only long term plan is to buy some land in France and live in a hut/carravan there :p.
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I too want a holiday home abroad at the young age of 62ish when i call it a day.
So my intention when the mortgage is paid off to save the old mortgage payment in the ISA plus a little extra & do this for approx 20 years and hopefully enough to buy a small place in the sun.!!
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>> hopefully enough to buy a small place in the sun.!!
I was planning to have a small place in the sun, instead I got a small son in the place which scuppered those plans.
Still cant get rid of him.
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Only may plan was to live there providing french planning laws have not changed by then!.
Either that are floor number 74 on some tower block.
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In the current climate you will have his company at least another 10 years & this will give you a drinking partner more son and dad bonding time.!! lol............
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And so you should this is what a pension is for.!!
After all he didn't ask to be born so get to bar.!! lol..........
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>>Instead of saving like a mad one i make over payments on the mortgage
I used to save in an interest bearing account and then make an overpayment at the end of the year. That was back in the days of variable rate, repayment mortgages, when it was all tallied up at the end of the year. My kids seem to change their lender every couple of years.
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Offset mortgages are very good when rates go up.
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>>..has earned the princely sum of £14.28 in interest in the last year.>>
Doesn't quite gell that sum.
Even if you were on around 2.5 to 2.8 per cent (which is about the ball park for interest rates at present and effectively a loss due to inflation), you would get almost as much for £1k as you state, rather than for nearly £3k.
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...Doesn't quite gell that sum...
Well, I have the statement in front of me, and what can't speak, can't lie.
It shows monthly interest payments of between £1.04 and £1.22.
There's no mention of any interest rate, perhaps they're ashamed of it.
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That is a dire return iffy - how did you get into it? Martyn Lewis has good tables and charts on most financial products. I am getting 3.2% and instant access on a cash ISA from Sanatander, an offer which won't be availabe any more.
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...That is a dire return iffy...
I opened it a good few years ago by just wandering into the branch.
To be fair to them, I asked for a simple, straightforward instant access savings product.
Since then, I've largely ignored it, which certainly since rates hit the floor, has probably cost me a few quid.
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you've been dumped into a holding account.
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>>Well, I have the statement in front of me, and what can't speak, can't lie.>>
I wasn't, in any way, doubting your words.
In fact, with such an apparently very low rate of interest, you are better off buying something you need for cash, rather than let inflation steadily cut the value of the investment.
>>There's no mention of any interest rate, perhaps they're ashamed of it.>>
I don't doubt that either...:-)
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>> >>..has earned the princely sum of £14.28 in interest in the last year.>>
>>
>> Doesn't quite gell that sum.
>>
>> Even if you were on around 2.5 to 2.8 per cent (which is about the
>> ball park for interest rates at present and effectively a loss due to inflation), you
>> would get almost as much for £1k as you state, rather than for nearly £3k.
>>
I've noticed that most new ISA's are introductory rates. They offer a really good rate in year 1, but then it hits the floor if you stick with it. Mine pays 2.8%, but its made up of 0.3% plus a first year bonus of 2.5% so unless that changes I will be moving on in April
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Well a chap of my acquaintance has decided he will get a better return from his savings by putting photo electric cells on his roof and take the guaranteed rate for every watt he generates, whether he uses it or puts it onto the grid. He also mitigates his electricity bill. The scaffolding goes up next Friday.
John
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How much will it cost, and how many years before he breaks even?
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Some houses are getting panels for free (Government plan) and get 46p a unto for anything they generate and don't use and feed into the grid.
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>> Some houses are getting panels for free (Government plan) and get 46p a unto for
>> anything they generate and don't use and feed into the grid.
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The free panels are not from the Government, they are from utility companies and others who assess your roof/land for its generating potential and decide that it is in the right location to make best use of it's solar power potential.
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>> How much will it cost, and how many years before he breaks even?
>>
You can take a zero cost risk free option - get one of the utility companies to install the PV panels, they will do it free of charge, and you get to keep the electricity you use yourself at no cost. In return, they take the money from the sale to the Grid at handsome prices (i.e. the rest of the consumers who don't install one of these systems) of the excess electricity that you don't use.
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...by putting photo electric cells on his roof and take the guaranteed rate for every watt he generates...
My brother did this, cost about 12K with pay back in about 10 years.
His motivation was partly environmental, but the cells are only remotely viable financially because of the artificially over-inflated price for the units.
Nothing wrong with taking advantage of that subsidy, but you could be left much worse off if it's withdrawn.
That must be a possibility in today's climate of cuts.
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>> His motivation was partly environmental, but the cells are only remotely viable financially because of
>> the artificially over-inflated price for the units.
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>> Nothing wrong with taking advantage of that subsidy, but you could be left much worse
>> off if it's withdrawn.
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His might have been installed when the FIT tariff had not been in place. If your roof is South facing, it will almost certainly make financial sense to install the panels under this new climate change incentive introduced by Labour. The subsidy is self financing, it is paid for by a levy on the muppets whose houses are not suitable or who do not take up the option to install solar PV. The subsidy cannot be withdrawn. It is a contract enforceable by law of contract.
Last edited by: John H on Thu 9 Dec 10 at 19:03
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Goodness knows! Depends on how sunny it's going to be. Prices seem to start at £12k ish for 2Kw unit and you get (I believe) 42p - 44p (can't remember) per unit generated whether you use it or not. Of course if you use it it's worth a further 10p or so off your leccy bill.
I read that the units are more costly in the UK than elsewhere and may come down in price. But the real attraction is the rate you get paid.
It's something that would need to be looked into in detail if you were interested. Must be respectable though - M&S advertise it!
John
Last edited by: Tooslow on Thu 9 Dec 10 at 18:59
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>> Goodness knows! Depends on how sunny it's going to be. Prices seem to start at
>> £12k ish for 2Kw unit and you get (I believe) 42p - 44p (can't remember)
>> per unit generated whether you use it or not. Of course if you use it
>> it's worth a further 10p or so off your leccy bill.
>>
It is a case of heads you win, tails they lose.
Yes, it is a scheme which pays you for the electricity you consume! So you save on paying for importing from the grid, and on top of that you get paid for not importing from the grid!
And then they pay you four times as much for any of the excess electricity you export.
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Electricity is generated only during daylight and the £12k systems have no storage - that costs considerably more.
Notwithstanding that, I did the sums recently and reckoned it will pay for itself in 8 - 10 years. The systems have a life expectancy of at least 25 years, probably longer than me. If I hadn't lost my job I would have been going for it - before the VAT increase!!
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>> I imagine I'm going to have to accept some risk to achieve a significantly better
>> return.
>>
>> That's OK by me, but what I'm not going to do is invest the lot
>> in the next Polly Peck.
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Taking your OP at face value, i.e. this is not advice and based on your risk attitude, a simple way to achieve your objectives would be to invest in a product like this:
www.nationwide.co.uk/mediacentre/PressRelease_this.asp?ID=1527
Even higher returns with a slightly higher risk profile are possible if you are willing to take a pound cost averaging approach to your investment using an online broker to invest in equity indexes via exchange-traded-funds.
Last edited by: John H on Thu 9 Dec 10 at 19:12
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Not saying this is for everyone but I too "dabble" in equities. Some are for long term and some for a quick in and out.
Bought 15000 shares in Lloyds on the 26/11/10 at 62.36p and as I bought them on a T20 I have until the 24th of this month to sell them and close the deal or pay for them. Today I was a whisker off selling for a £1000 profit but didn't.
If they do reach that figure I will sell rather than buy them.
Great when it works as it is profit for a few mouse clicks.
I still have some more Lloyds and holding for the longer term as i can see them doing well, especially when they eventually resume dividend payments.
As they always say, DYOR.
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MtT
Have you made good long term profits as a semi daytrader? Most people I know somehow have a habit of only remembering the good trades!
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I,m not a daytrader, just always looking for an opportunity to make a few quid. As for losing trades, I can certainly remember them and I don't believe anyone who says that they have never lost on some deals.
As I said it's not for everyone, but over the last couple of years, I have done quite well with Lloyds and Barclays.
A mate of mine has done really well in the last month with Red Rock Resources. He was always on at me to buy some when they were under 2p a share but they had been that price for a couple of years, so I did not bother
Well, they had a break out and in the space of a couple of weeks they shot up to about 19p and he held 350,000 of them at an average price of 1.8p so did very nicely. I think he took profit at about 16p and still has 100,000 running.
I think the main thing is not to be greedy and take profit when you can, but I certainly don't claim it to be an easy way to make money.
Last edited by: MrTee43 on Fri 10 Dec 10 at 11:53
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Setting up and maintaining a stop-loss system is really important, although it can be frustrating when shares head south as soon as you buy them, only to go into reverse the minute they're sold. Better to be safe than sorry, though.
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Regular monthly savings are worth consideration.
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For income, I have bought Exchequer 12% 2013-2017. At today's price it pays about 9% per annum and is as safe as an investment can be. Be aware the way gilts work, however. At redemption you only get par value so the yield to redemption is nearer 1%. You will need to buy from a stockbroker he will need about 1.6% comission to buy and the same to sell. For a fund (i.e. with growth prospects) I have Schroder Income Maximiser, now yielding about 7%.
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Some nice yields here as well:
www.thisismoney.co.uk/pibs-psbs/
The danger is that these shares rate last in the event of a crash and Northern Rock holders lost their shirts. Nationwide is probably the safest bet.
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Half my pension pot is in a proper pension scheme, and half is in unit trusts. If you buy shares, the lowest risk way is to buy into a unit trust which purchases shares in a large number of companies. That way you are protected from one bad one. And the best way to buy unit trusts is as part of an ISA for obvious reasons. You then have to choose managed trusts, and trackers. If you choose the right manager, you are quids in, but how do you know which is good? I now buy only trackers, which just buy a selection of shares in the stock market chosen by computer or whatever. Fees are low, and performance compares with all but the best fund managers. Why buy a managed fund with higher charges when on average they do not do as well?
Oh, and don't forget pension. You get back an instant ~20% tax back. And if you pay higher rate tax, you can claim that back up to the limit of the higher rate tax you have paid in that year. I have a pension based on a tracker fund on the FTSE 100.
I'd stick to UK or maybe European shares, though the Euro looks dodgy. Far Eastern shares have potential for huge returns ... and huge losses. I know, I lost a lot on Japanese shares, though overall I have done very well.
Ah yes, and shares are really for the long term i.e. 5 years plus.
Here's a question for t'others: If in one year I pay in a large sum into a pension fund such that I can only claim back higher rate tax on some of the money, can I claim higher rate tax back in the following year on the remaining sum?
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Losing interest in my savings - R.P.
