Sledgehead Posted May 12, 2011 Share Posted May 12, 2011 My first thought was inflation to plummet! My second thought was interest rates to rise!? or, coupled with : - Bin Laden pantomime, - increase in margins, - short attack when London closed, maybe just another attempt to forestall the flocking of disillusioned savers into real money? Quote Link to comment Share on other sites More sharing options...
EvilEdna Posted May 12, 2011 Share Posted May 12, 2011 There's a similar three year deal here if anyone's interested. Quote Link to comment Share on other sites More sharing options...
corevalue Posted May 12, 2011 Share Posted May 12, 2011 My first thought was inflation to plummet! My second thought was interest rates to rise!? I thought the same, but in reverse order. A hike in interest rates is coming, which (or is supposed to) reduces inflation. I'll keep my powder dry. Quote Link to comment Share on other sites More sharing options...
Sour Mash Posted May 12, 2011 Share Posted May 12, 2011 My first thought was a new house price index included in RPI instead of food, fuel and energy costs. Good thinking. Given how they pulled the 'inflation proof' savings just before inflation really took off we can be pretty sure that they aren't re-introducing them because they want to give savers a safe option to maintain the value of their savings. Once prices start to drop appreciably it's almost a cert that the official inflation measure will be adjusted to include them, conveniently ignoring the fact that they were kept out of inflation figures during the boom. This should give plenty of scope to keep base rates low whilst ignoring soaring costs of food and energy. Quote Link to comment Share on other sites More sharing options...
Cinzano Bianco Posted May 12, 2011 Share Posted May 12, 2011 There's a similar three year deal here if anyone's interested. Can't withdraw though. Quote Link to comment Share on other sites More sharing options...
Quicken Posted May 12, 2011 Share Posted May 12, 2011 Can't withdraw though. More importantly, it isn't tax free either. Quote Link to comment Share on other sites More sharing options...
bendy Posted May 12, 2011 Share Posted May 12, 2011 I thought the same, but in reverse order. A hike in interest rates is coming, which (or is supposed to) reduces inflation. I'll keep my powder dry. i thought this but have gone with some anyway. at best we're going to see IR at 1.5% within a year and inflation at 2%. plus the 0.5% i'll keep the ns&i deal. Quote Link to comment Share on other sites More sharing options...
wish I could afford one Posted May 12, 2011 Share Posted May 12, 2011 297 days since they were last available as detailed here http://retirementinvestingtoday.blogspot.com/2011/05/ns-index-linked-savings-certificates.html With a real after tax return, while keeping your money "safe", being impossible to find I wonder how long until they are "sold out" Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted May 12, 2011 Share Posted May 12, 2011 Did I read the article right - it is a minimum 5 year fixed deal? Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted May 12, 2011 Share Posted May 12, 2011 My first thought was inflation to plummet! My second thought was interest rates to rise!? Yes, I am reading it as you having to keep your money in it for 5 years. So what does the BOE do, gets people to move into these now... and then in a month or two they begin the rise of IRs? Quote Link to comment Share on other sites More sharing options...
Cinzano Bianco Posted May 12, 2011 Share Posted May 12, 2011 More importantly, it isn't tax free either. Not similar at all then really Quote Link to comment Share on other sites More sharing options...
Cinzano Bianco Posted May 12, 2011 Share Posted May 12, 2011 (edited) Yes, I am reading it as you having to keep your money in it for 5 years. So what does the BOE do, gets people to move into these now... and then in a month or two they begin the rise of IRs? AIUI, you only need to keep them for a year to earn RPI on them (tax free). You get the full benefit of the extra 0.5% if you keep them for the full term. Edit: 5-year Index-linked Savings Certificates 48th Issue Purchase price + index-linking for year 1+ 0.25% of purchase price = 1st anniversary value 1st anniversary value + index-linking for year 2 + 0.35% of 1st anniversary value = 2nd anniversary value 2nd anniversary value + index-linking for year 3 + 0.40% of 2nd anniversary value = 3rd anniversary value 3rd anniversary value + index-linking for year 4 + 0.65% of 3rd anniversary value = 4th anniversary value 4th anniversary value + index-linking for year 5 + 0.86% of 4th anniversary value = maturity value Edited May 12, 2011 by the.ciscokid Quote Link to comment Share on other sites More sharing options...
adamLancs Posted May 12, 2011 Share Posted May 12, 2011 I hope everybody stays away from these certificates. My money hasn't cleared yet. Quote Link to comment Share on other sites More sharing options...
Normal Posted May 12, 2011 Share Posted May 12, 2011 AIUI, you only need to keep them for a year to earn RPI on them (tax free). You get the full benefit of the extra 0.5% if you keep them for the full term. Edit: 5-year Index-linked Savings Certificates 48th Issue Purchase price + index-linking for year 1+ 0.25% of purchase price = 1st anniversary value 1st anniversary value + index-linking for year 2 + 0.35% of 1st anniversary value = 2nd anniversary value 2nd anniversary value + index-linking for year 3 + 0.40% of 2nd anniversary value = 3rd anniversary value 3rd anniversary value + index-linking for year 4 + 0.65% of 3rd anniversary value = 4th anniversary value 4th anniversary value + index-linking for year 5 + 0.86% of 4th anniversary value = maturity value Interesting, these are different figures from the ones I originally posted that I got from the NS&I site earlier. Yours appear to be correct. Quote Link to comment Share on other sites More sharing options...
catsick Posted May 12, 2011 Share Posted May 12, 2011 Inflation product in the uk is cr@p as the pension funds hoover up anything the government sells as they have made a load of inflation linked promises they cant keep .. In oz and nz you can get inflation + 4% on gov bonds and you are dealing with a government with almost no debt so a hell of a lot safer than the uk crowd , ie you get your index linking and a decent cash return on top and its a hell of a lot safer than the uk backed by a load of coal, gas, gold, iron ore and sheep .... Quote Link to comment Share on other sites More sharing options...
Pent Up Posted May 12, 2011 Share Posted May 12, 2011 AIUI, you only need to keep them for a year to earn RPI on them (tax free). You get the full benefit of the extra 0.5% if you keep them for the full term. Edit: 5-year Index-linked Savings Certificates 48th Issue Purchase price + index-linking for year 1+ 0.25% of purchase price = 1st anniversary value 1st anniversary value + index-linking for year 2 + 0.35% of 1st anniversary value = 2nd anniversary value 2nd anniversary value + index-linking for year 3 + 0.40% of 2nd anniversary value = 3rd anniversary value 3rd anniversary value + index-linking for year 4 + 0.65% of 3rd anniversary value = 4th anniversary value 4th anniversary value + index-linking for year 5 + 0.86% of 4th anniversary value = maturity value So I could hold some for say 6 months earning RPI, then for arguments sake say an account became available beating RPI after tax I could cash the certificates in and move into the savings account? Basically what I'm saying is could you hold then until an account becomes available that beats it, even if less than one year? Also how is RPI calculated and paid? Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted May 12, 2011 Share Posted May 12, 2011 So I could hold some for say 6 months earning RPI, then for arguments sake say an account became available beating RPI after tax I could cash the certificates in and move into the savings account? Basically what I'm saying is could you hold then until an account becomes available that beats it, even if less than one year? Also how is RPI calculated and paid? I looked at their blurb an hour ago and on the first page was this: Withdrawal arrangementsCan be cashed in early, but no index-linking or interest paid if cashed in during the first year http://www.nsandi.com/savings-index-linked-savings-certificates So you get no interest if you take it out within a year. Quote Link to comment Share on other sites More sharing options...
SarahBell Posted May 12, 2011 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. 15k max each. Is it on sale yet? Or has it sold out? Quote Link to comment Share on other sites More sharing options...
Pent Up Posted May 12, 2011 Share Posted May 12, 2011 I looked at their blurb an hour ago and on the first page was this: http://www.nsandi.com/savings-index-linked-savings-certificates So you get no interest if you take it out within a year. Thanks. So you are taking a gamble that inflation will still be high a year from now. I'm not so sure it will. Quote Link to comment Share on other sites More sharing options...
CrashInHand Posted May 12, 2011 Share Posted May 12, 2011 Thanks. So you are taking a gamble that inflation will still be high a year from now. I'm not so sure it will. Hedge against hyperinflation. I can't see banks ever paying more than inflation tbh. Quote Link to comment Share on other sites More sharing options...
jonb Posted May 12, 2011 Share Posted May 12, 2011 My first thought was a new house price index included in RPI instead of food, fuel and energy costs. Houses aren't a retail price so they won't be included in a Retail Prices Index. RPI does include mortgage payments as part of is housing costs element though. If house prices go down, then monthly mortgage payments will go down as well, but interest rates will almost certainly go up at some point, and that will likely more than offset the reduced capital cost. If house prices are included in future inflation targeting, then it is likely that a new inflation index would be created for that purpose. Quote Link to comment Share on other sites More sharing options...
ccc Posted May 12, 2011 Share Posted May 12, 2011 Houses aren't a retail price so they won't be included in a Retail Prices Index. RPI does include mortgage payments as part of is housing costs element though. If house prices go down, then monthly mortgage payments will go down as well, but interest rates will almost certainly go up at some point, and that will likely more than offset the reduced capital cost. If house prices are included in future inflation targeting, then it is likely that a new inflation index would be created for that purpose. I am pretty certain the RPI includes some form of house price numbers as well within it's housing costs section. Can't be arsed wading through the details to check though. Quote Link to comment Share on other sites More sharing options...
trekking Posted May 12, 2011 Share Posted May 12, 2011 15k max each. Is it on sale yet? Or has it sold out? On sale from this morning. Quote Link to comment Share on other sites More sharing options...
davidcameron Posted May 12, 2011 Share Posted May 12, 2011 15k max each. Is it on sale yet? Or has it sold out? Their remit is to raise £14bn this tax year. Do you think there was £14bn sitting in current accounts looking for a home? Quote Link to comment Share on other sites More sharing options...
SarahBell Posted May 12, 2011 Share Posted May 12, 2011 Their remit is to raise £14bn this tax year. Do you think there was £14bn sitting in current accounts looking for a home? 3.6bn is the amount put into isas last year and lloyds said they had 5bn put into savings last year too. Quote Link to comment Share on other sites More sharing options...
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