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desertorchid

New Rpi+ Accounts

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Anyone going for any of the new RPI+ accounts coming onto the market:

Press release

The post office account with RPI+1.5% still seems a good deal. Worst case scenario CPI falls back towards target and you get 4-5% interest rate. Your protected against inflation running out of control and Merve sitting on his hands indefinitely.

The 5 year term is a pain but gotta be worth tucking a bit away here.

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I initially thought "hell yes", thinking it was the NS&I back, but it's taxable. So 6% tax free under NS&I or 3.6% Post Office after 40% tax. And NS&I have said they will relaunch theirs at some point, which must be within the next 5 years.

So not for me, though if I wasn't paying tax then yes, the five year lock in would not be a problem.

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According to Martin Lewis's email regarding this, the interest each year isn't compounded (no interest on interest), which doesn't really make it 'inflation busting', given that next year's inflation will definitely 'compound' on this year's... :(

EDIT: Just to clarify that I'm talking about the Post Office one; I think there's another RPI that's just been released, isn't there? Saw it mentioned somewhere or other earlier, but can't now recall who was offering it or what the T+Cs were... old age...

Edited by Ologhai Jones

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The 5 year term is a pain but gotta be worth tucking a bit away here.

Yep, 5yrs is too long, not just that, but if you cancel there's a "breakage charge" meaning you may get back less that you put in. Not good.

I'll need to access my STR fund at a moments notice, so it's no good for me, but if I was retired I'd certainly look into putting some of my money in it.

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Get a S&S ISA and buy index-linked gilts with as high a coupon as possible or go with a tracker like INXG. Low risk, inflation proofing, flexible.

I've filled my S&S ISA allowance for this year and i was planning on buying a fund with (a % of it) with index linked guilts at it's heart. Trying to work out what a balanced portfoilio will be this year.

What goes skywards when wars, inflation and national disasters kick off?! Syggestions on a post code.

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What about this one?

KRBS - Inflation Linked Cash ISA (formerly? Kent Reliance Building Society)

New! Inflation-beating cash ISA: Lock into Kent Reliance BS (min £2,500) for 5 years and its new tax-free ISA pays the increase in RPI inflation over that time plus 2%, making it best-of-breed. As annual RPI's currently 5.3% this is a good hedge for those worried inflation's eating their savings, though over 5 yrs things could change radically.

I've not read the small print yet. Only just seen the latest tip.

If we're heading for a bit of 1970s stagflation then it could be a smart move - Retail Price Index Since 1960 - unless of course they decide to change how RPI is calculated over the next 5 years to mask the savage inflation.

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New! Inflation-beating cash ISA: Lock into Kent Reliance BS (min £2,500) for 5 years and its new tax-free ISA pays the increase in RPI inflation over that time plus 2%, making it best-of-breed. As annual RPI's currently 5.3% this is a good hedge for those worried inflation's eating their savings, though over 5 yrs things could change radically.

How does that beat inflation? If it is as worded, it is RPI-3.3%, a truly terrible rate.

e.g. RPI becomes 7%

Increase in RPI is 7%-5.3%=1.7%

So the rate is 3.7%, hardly inflation busting.

Has anyone taken the time to check out the small print to see if this is how it works? I'm not going to bother as a 5 year lock in is too long for me.

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  • 277 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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