VeryMeanReversion Posted May 12, 2011 Report Share Posted May 12, 2011 On the HPC blog and http://www.nsandi.com/savings-index-linked-savings-certificates Rather than RPI+1% tax-free, its RPI+0.5% tax-free. If you believe in inflation (I do), it looks ideal. They seem to have removed the ability to hold one in an under-7 child's name from a quick look. Quote Link to post Share on other sites
exiges Posted May 12, 2011 Report Share Posted May 12, 2011 They seem to have removed the ability to hold one in an under-7 child's name from a quick look. They've also removed the 3yr certificate. Quote Link to post Share on other sites
_w_ Posted May 12, 2011 Report Share Posted May 12, 2011 On the HPC blog and http://www.nsandi.co...gs-certificates Rather than RPI+1% tax-free, its RPI+0.5% tax-free. If you believe in inflation (I do), it looks ideal. They seem to have removed the ability to hold one in an under-7 child's name from a quick look. Thank you for the heads up, much appreciated. Quote Link to post Share on other sites
Bloo Loo Posted May 12, 2011 Report Share Posted May 12, 2011 How do bankers earn RPI + 0.5% plus profit? Quote Link to post Share on other sites
bomberbrown Posted May 12, 2011 Report Share Posted May 12, 2011 Could they have introduced these again in an attempt to try and reduce inflation? My thinking is that these will 'soak' up quite a lot of cash thats out there. Or is that a naive or stupid assessmnent? Quote Link to post Share on other sites
winkie Posted May 12, 2011 Report Share Posted May 12, 2011 RPI guaranteed, tax free, plus guaranteed to be safe has got to be better than what you get in other savings accounts....only need to keep it for a year. I am sure the banks and building societies will lose some of their deposits because of this....will they now start giving their loyal savers a better deal because of the new competition?....I wonder. Quote Link to post Share on other sites
_w_ Posted May 12, 2011 Report Share Posted May 12, 2011 Could they have introduced these again in an attempt to try and reduce inflation? My thinking is that these will 'soak' up quite a lot of cash thats out there. Or is that a naive or stupid assessmnent? You are giving this money to the government who will spend it as part of its <cough>bullsh*t<cough> austerity program. The money always ends up back in banks as <cough>gambling money<cough> deposits. Quote Link to post Share on other sites
RegularInv Posted May 12, 2011 Report Share Posted May 12, 2011 Could anyone help please with total interest earned on certificate bought today for amount say £10k and if RPI goes down from say 5.0% to 4.5% in first year? Quote Link to post Share on other sites
bobthe~ Posted May 12, 2011 Report Share Posted May 12, 2011 (edited) Could anyone help please with total interest earned on certificate bought today for amount say £10k and if RPI goes down from say 5.0% to 4.5% in first year? you get 4.5% + 0.5% (making 5%) tax free. If you need someone to work out 5% of 10k, then presumably the "Inv" part of your name doesn't stand for "Investor". Edit to add: That is per year, so if inflation is constant, then it is 5% per year compounded. It also used to be tax free if held for a year or more. Is that still true? Edited May 12, 2011 by bobthe~ Quote Link to post Share on other sites
Normal Posted May 12, 2011 Report Share Posted May 12, 2011 Could anyone help please with total interest earned on certificate bought today for amount say £10k and if RPI goes down from say 5.0% to 4.5% in first year? 1st anniversary value= Original value * (Change in RPI value + year 1 bonus) = 10000 * (0.045 + 0.0005) = £455 Actually, they take the RPI value from 2 months ago, but let's not confuse matters too much. Quote Link to post Share on other sites
_w_ Posted May 12, 2011 Report Share Posted May 12, 2011 you get 4.5% + 0.5% (making 5%) tax free. If you need someone to work out 5% of 10k, then presumably the "Inv" part of your name doesn't stand for "Investor". Could it be invertebrate? Quote Link to post Share on other sites
Normal Posted May 12, 2011 Report Share Posted May 12, 2011 you get 4.5% + 0.5% (making 5%) tax free. If you need someone to work out 5% of 10k, then presumably the "Inv" part of your name doesn't stand for "Investor". Edit to add: That is per year, so if inflation is constant, then it is 5% per year compounded. It also used to be tax free if held for a year or more. Is that still true? No, you don't get 0.5% every year... Year Bonus rate1 0.05%2 0.07%3 0.10%4 0.30%5 0.71% Quote Link to post Share on other sites
bobthe~ Posted May 12, 2011 Report Share Posted May 12, 2011 (edited) 1st anniversary value= Original value * (Change in RPI value + year 1 bonus) = 10000 * (0.045 + 0.0005) = £455 Actually, they take the RPI value from 2 months ago, but let's not confuse matters too much. 500. It is +0.5%, not 0.05% Edit to add - apologies, I hadn't read the prospectus. Presumably it works out to 0.5% if held the full term? Edited May 12, 2011 by bobthe~ Quote Link to post Share on other sites
Lagarde's Drift Posted May 12, 2011 Report Share Posted May 12, 2011 1st anniversary value= Original value * (Change in RPI value + year 1 bonus) = 10000 * (0.045 + 0.0005) = £455 Actually, they take the RPI value from 2 months ago, but let's not confuse matters too much. And, they actually take the RPI value from a certain month, which is correlated to the time in which the certificates are purchased / redeemed. So monthly fluctuations also make a difference. It's not just a matter of looking at the headline RPI %change. It is still taking the piss when inflation in reality is much higher. Quote Link to post Share on other sites
RegularInv Posted May 12, 2011 Report Share Posted May 12, 2011 you get 4.5% + 0.5% (making 5%) tax free. If you need someone to work out 5% of 10k, then presumably the "Inv" part of your name doesn't stand for "Investor". Edit to add: That is per year, so if inflation is constant, then it is 5% per year compounded. It also used to be tax free if held for a year or more. Is that still true? I probably can work out 5% of 10k, I have a calculator . Thanks to everyone answering my question, appreciate it. Quote Link to post Share on other sites
spyguy Posted May 12, 2011 Report Share Posted May 12, 2011 Look's like UKGOV has decided it needs the deposits more than banks. Poof! And in an instance, 50%+ of bank deposits disappear into NSI bonds. Quote Link to post Share on other sites
bendy Posted May 12, 2011 Report Share Posted May 12, 2011 Look's like UKGOV has decided it needs the deposits more than banks. Poof! And in an instance, 50%+ of bank deposits disappear into NSI bonds. Mine just did Precursor to more QE? Might as well get the rate rather than the paltry amount that the banks will offer. Quote Link to post Share on other sites
Lazybones Posted May 12, 2011 Report Share Posted May 12, 2011 Anybody holding NS&I in a SIPP? Is it better/worse than the market tracking funds? Quote Link to post Share on other sites
spyguy Posted May 12, 2011 Report Share Posted May 12, 2011 By my rough + ready reckoner that means mortgage debt is going to cost ~ 7% - 5% risk free return + 2% operating costs + profit. Quote Link to post Share on other sites
Pent Up Posted May 12, 2011 Report Share Posted May 12, 2011 Is your money tied in with for a fixed term? How exactly I'd the rate you get calculated as inflation varies throughout the year? Quote Link to post Share on other sites
guitarman001 Posted May 12, 2011 Report Share Posted May 12, 2011 I put a wad of my savings in last June for a 3-year certificate (not sure if when it's rolled over I get the same 1% on top deal, or if it'd be switched to this 0.5% on top)... £11.5k currently gives me back approx £550 on top so far. Not sure if I'm going to pour any more money in. Quote Link to post Share on other sites
Reck B Posted May 12, 2011 Report Share Posted May 12, 2011 I'm uneasy at investing in anything to do with the ultimate market manipulators who also have all the information. There will be reasons for the re-issuing of these and I doubt allowing you to protect yourself against inflation is the main one. Quote Link to post Share on other sites
Pent Up Posted May 12, 2011 Report Share Posted May 12, 2011 I'm uneasy at investing in anything to do with the ultimate market manipulators who also have all the information. There will be reasons for the re-issuing of these and I doubt allowing you to protect yourself against inflation is the main one. My first thought was inflation to plummet! My second thought was interest rates to rise!? Quote Link to post Share on other sites
Timm Posted May 12, 2011 Report Share Posted May 12, 2011 You are giving this money to the government who will spend it as part of its <cough>bullsh*t<cough> austerity program. (...) (...) Government funding needs overrides bank lobbying? Surely not, things must be desperate. If one takes the view that Government spending is not funded by taxation, one might think that perhaps this has more to do with inflation. But inflation does not seem to be at the sort of levels they would be worrying about ATM... (...) Precursor to more QE? (...) Ahh. You might have something there. Quote Link to post Share on other sites
Democorruptcy Posted May 12, 2011 Report Share Posted May 12, 2011 My first thought was inflation to plummet! My second thought was interest rates to rise!? My first thought was a new house price index included in RPI instead of food, fuel and energy costs. Quote Link to post Share on other sites
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