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A Familiar Question - How To Protect Your Savings...!?


longtimelistener
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Hello all. Its my first post after a year or so of stalking these boards... so be gentle!

I am a young chap in a rather fortunate position in that I have inherited a sum of approx £35k.... even though I was lucky enough to inherit it and I have not directly earned or saved for it – preventing this cash dissipating into nothingness is still a major, major issue.

I am a novice, but have spent the last year or so trying to keep a keen eye on the situation, admittedly mainly through this website and the links it provides. I have also tried to read around a little.

It seems to me that the big problems that have caused this economic situation are still being allowed to continue, and even worse being potentially damaging over stimulating QE.

Although like everyone here I want eventually to buy a home, at the moment I just can’t imagine house prices not taking a further tumble, and so I don’t see this as a reasonable option just yet.

As with many folk, including those with a large STR fund, the big question on my lips is how do I protect this fund. Is the UK going to spiral into further economic woe, and have I missed the opportunity to protect my inheritance to the maximum extent possible?!

Back in April I considered putting 10% in gold, but didn’t do it in the end as I plain and simply got a bit nervous, delayed and eventually the busyness of life took over... now I find myself in November in the same situation. I am currently considering the following, but I don’t know how to go about portioning such a ‘portfolio’...

30% foreign (EURO/AUD/DKK cash account receiving little interest – how easy to do this?)

Is dollar a no-no...?? Peter Schiff would certainly say so...

10% gold

50% sterling cash ISA’s shifted to the highest available rates (don’t want to lose my ISA allowances...)

10% savings bond in sterling

I currently have 50% in a savings bond at 3.75% ending April. Is it worth ending a year bond 6 months early to try and ditch sterling?

As always, i do not expect foolproof answers from anyone, as I understand that this is something that I have to be comfortable with and ultimately understand myself - its my money and we are in risky times.. I would just really appreciate any input from you guys, as i do think that there are a few clever bodies stalking this site.

Many thanks in advance.

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Hello all. Its my first post after a year or so of stalking these boards... so be gentle!

I am a young chap in a rather fortunate position in that I have inherited a sum of approx £35k.... even though I was lucky enough to inherit it and I have not directly earned or saved for it preventing this cash dissipating into nothingness is still a major, major issue.

I am a novice, but have spent the last year or so trying to keep a keen eye on the situation, admittedly mainly through this website and the links it provides. I have also tried to read around a little.

It seems to me that the big problems that have caused this economic situation are still being allowed to continue, and even worse being potentially damaging over stimulating QE.

Although like everyone here I want eventually to buy a home, at the moment I just cant imagine house prices not taking a further tumble, and so I dont see this as a reasonable option just yet.

As with many folk, including those with a large STR fund, the big question on my lips is how do I protect this fund. Is the UK going to spiral into further economic woe, and have I missed the opportunity to protect my inheritance to the maximum extent possible?!

Back in April I considered putting 10% in gold, but didnt do it in the end as I plain and simply got a bit nervous, delayed and eventually the busyness of life took over... now I find myself in November in the same situation. I am currently considering the following, but I dont know how to go about portioning such a portfolio...

30% foreign (EURO/AUD/DKK cash account receiving little interest how easy to do this?)

Is dollar a no-no...?? Peter Schiff would certainly say so...

10% gold

50% sterling cash ISAs shifted to the highest available rates (dont want to lose my ISA allowances...)

10% savings bond in sterling

I currently have 50% in a savings bond at 3.75% ending April. Is it worth ending a year bond 6 months early to try and ditch sterling?

As always, i do not expect foolproof answers from anyone, as I understand that this is something that I have to be comfortable with and ultimately understand myself - its my money and we are in risky times.. I would just really appreciate any input from you guys, as i do think that there are a few clever bodies stalking this site.

Many thanks in advance.

Looks like a reasonable balance you've got between sterling (60%) and non-sterling (40%) assets although you may hear all sorts of other contradictory opinions on HPC.

Regarding gold - I hold mine in FTSE100 listed 'Randgold Resources' for 2 reasons. (1) The spread on dealing is about 1% or less - much cheaper than holding physical gold. (2) The share price more or less mirrors the rise / fall of gold and more. (3) It's saleable within seconds, unlike physical gold which needs a safe place and transporting to buy / sell. If we ever get a "head-for-the-hills-and-stock-up-on-shotguns-and-generators" scenario which some doomsayers predict, then you could cash in shares at short notice and swap it for the real glittery jingly stuff.

I won't try and answer your other points - there are plenty on HPC who can do that.

But, at the end of the day ... no-one really knows if the dollar will collapse, if sterling will end up as toilet paper.

Do keep your ISA's though for the moment. They may be paying crap rates at the moment, but unless we enter a Zimbabwean scenario, you'll probably be glad you hung on. But keep a close watch on the situation just in case inflation does start to get really serious.

;)

Edited by johnny5thumbs
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Thanks for the reply Jonny,

I was considering www.goldmoney.com, but still have to finalise the research... As for keeping the ISA's i agree and do want to keep hold. Its the 1 year bond that i am concerned about, as 90% of the fund is split between this and the ISA's... If i want to diversify quickly (i.e. before March next year) then it means leaving one of these behind. Not overly keen on losing 6 months interest on the bond, but then again, it could be a lot worse come March...!

I have a CitiBank Dollar account, but at the moment i am at a loss on how to get money into any other currency... any advice welcome. I heard about a nationwide euro account, but i struggled to tie it down on the website.

Cheers for your input.

p.s. sorry that this thread may have been parked in the wrong sub-forum, it probably should be in the investment section... my bad.

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  • 2 weeks later...

I just opened a CitiBank foreign currency account, I went for AUD (it was easy). I see you can choose between a variety of currencies, so maybe you could set up another account. http://www.citibank.co.uk/personal/banking/international/deposits.htm?merchant=citi

Like yourself, I feel a bit more comfortable knowing that I can get out of GBP quickly if TSHTF. I have a liitle physical gold as well bought from Bairds.

Like others have said, it's perhaps after the election that things may go south, so you may be ok on your bond.

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