Thursday, Jul 16, 2009
What's going on with savings rates?
Telegraph: Rate alert: fixed rates reach 5.4pc
Moneyfacts' figures show that the interest rate on the average fixed-rate bond has risen by 1.37 percentage points since base rate was kept on hold in March.
Posted by uncle chris @ 09:16 PM (1930 views) Add Comment
22 Comments
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1. little professor said...
Meh. 3-5 year bonds don't interest me - with inflation set to take off within the next 18 months, 5% will look like chicken-feed
2. mark wadsworth said...
What LP says. A one-year bond paying 4% plus, now that would be of interest.
But by the same token, I thought the same a year ago when you could get 5% interest and everybody was worried about inflation, so that 3% of my savings flushed down the toilet. Ah well.
3. yoyo1 said...
The Newcastle has a 5 year bond at 5% and you can withdraw money with no penalty on the interest if you give 90 days notice.
4. nomad said...
The Newcastle bond has been withdrawn. But thankyou to the site contributors that flagged this one a few days ago.
5. a saver said...
Drat! That Newcastle bond sounded perfect, yoyo1. I've just come to the end of my fixed 6.1% interest period on my main HBOS account, so was going to do some research at the weekend. Must be quite a few HBOS clients in the same boat, all set to make some big withdrawals.
6. peter_2008 said...
Great news!! If bond rate goes up, so is mortgage rate. If the average fixed saving rate gets to 5%, I would expect average mortgage rate to reach 7%. All hell may break loose then, but hee, if we get cheaper houses, who gives a shxt!
7. nomad said...
The Newcastle bond was excellent in that as long as the minimum £5,000 is left in the account for the full five years, you continue to receive the 5% interest.
I agree wholeheartedly with LP - this is no time to lock money away at fixed IR for more than two years.
There is an HSBC Singapore multi-currency online account, virtually no interest but you can throw money around ten currencies which include USA, Canada, Hong Kong, Singapore, Sterling, Australia, New Zealand, Switzerland, Euro - minimum deposit 2,000 SD. Has anyone looked at that and do you have a view? £10,000 across to a strong currency - pound drops 20% - bring it back as £12,500.
8. uncle tom said...
I would concur with LP. Even in the best of times, putting savings in a long term account, where you cannot access them without a significant penalty, is not terribly wise. Everyone's circumstances change, and part of the calculation behind these offers is that a significant percentage of savers will pull their money out early, usually losing all interest as a result.
If the deal makes it impossible to withdraw funds under any circumstances, before the term is up; then the saver has to bear in mind that there is a significant risk that in five years we will have seen substantial inflation, with a smaller risk that hyperinflation will have occurred; leaving them in wipeout.
9. titaniccaptain said...
Uncle Chris, Uncle Tom.....One of you mentioned Rose Cottage in Crickhowell over a year ago......its up for sale!....
@LP
What do you think will drive inflation up in 18months?
10. general congreve said...
@7 Nomad - Looks like the HSBC Singapore multi-currency account actually pays 0% interest. It doesn't say how it works, but seeing as you need a minimum 2000 Singaporean dollars in the account I assume your deposit is denominated in Singaporean dollars, only being convertible to the other 9 currencies upon withdrawal. Therefore I assume you are at the mercy of the strength of the Singaporean Dollar, so I think it's unlikely it's a 'sterling get out of jail free card and make some loot into the bargain account'. It doesn't say anything about exchange charges either, you need to phone for more details.
11. george monsoon said...
Ah.. Titanic Captain.. the one name on here that I can put a face to .
Are there any new video interviews looming.. I would suggest one where you interview an Estate Agents. I am sure they will prove entertaining..!
12. nomad said...
Thanks for that GC, certainly the local branch knows nothing about it.
13. titaniccaptain said...
@George Monsoon
The QE was the last one I did...no interviews just me prancing around.
http://www.economicvoice.com/speakers-post.php?post=218
I am working on a 2 part interview on the recession.....
14. titaniccaptain said...
P.s. I wrote the music and played all the instruments on the Vids so will be releasing that as a separate project called "Ive been had by all my family"
15. nomad said...
If it helps GM, I look like a cross between Tom Cruise and George Clooney - but a bit younger and little more macho!
16. Tpbeta said...
nomad the halifax international lets you do much the same thing between dollars pounds and euros and has 1.35% interest
17. techieman said...
nomad you mean 4'7" with grey hair?
18. george monsoon said...
I look more like myself in the mirror than I do in photographs.
19. nomad said...
techieman, have we met?
20. Crashhorizon said...
My favourite is with Investec Private Banking. Pays the average of the top 5 accounts. The rate is re-calculated every week and the rate has been steadily moving up over the last few months.
Currently only paying 3.11% but would prefer to get a consistently good rate and the rate should increase over the next few months.
Miniumum £25k and 90 days notice.
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