The material on this website is for information only
and is not intended as any recommendation or endorsement of any products or companies mentioned. We are not licensed by the FSA to give financial advice, and none of the material on this website constitutes or is intended to constitute financial ...
News
PC AdvisorDon't get caught out by these new (and old) scams in the UK. Here's how to...PC AdvisorThe scam usually involves manipulating the figures so that you're owed money from HMRC and specifying a new bank account for the repayment. Naturally, that's an account to which the criminals have access. HMRC recommends ... Of course, this is all a ...
Money MarketingHow to solve the self-employed savings crisisMoney MarketingBoring Money founder and managing director Holly Mackay says: “There can be real advantages in the self-employed making contributions to a pension. Apart from the usual tax reliefs, it can push ... But Sanlam UK head of employee benefits Elliot Silk ...
To love, honor and share a credit card statementDaily MailMoney is a common topic for arguments in relationships, notes Sonya Britt, an associate professor of personal financial planning at Kansas State University who specializes in financial therapy, which she suggests for all soon-to-be wed couples. Her ...and more »
This is MoneyTop gripes about pension freedoms revealed: Delays, bungled admin, exit fees and compulsory financial advice anger ...This is MoneyCommon gripes are clashes with pension providers over delays to accessing savings, exit fees, bungled admin, misinformation from firms, and the requirement to pay for financial advice on some types of pot worth £30,000-plus, new data from the Financial ...and more »
BloombergCatwalk Cartel May Be Robbing Retailers, U.K. Watchdog WarnsBloombergIt's cash crunches like Thompson's that lead many people to pile up credit card debt, bounce checks, or turn to payday lenders, which charge high interest rates and fees for making loans against your paycheck. The result can be further fees for late ...and more »
Have you met...
Latest Members:


midomidi2013


asmaasaad


shazly


ser1es


Tania Bae


peuores


DeanWatriama

 

Homebuyers are cheering, but what about savers?

Interest rates down to 3.75% and at their lowest for almost 50 years - so there’s the expectation that mortgages will cost less too. But of course what applies to home loans applies to savings too – and savers are far from happy anticipating even less interest on their money.
Not so long ago when interest rates were low the answer was to invest in the stock market. Equity based investments like unit trusts, investment trusts, Oeics (open ended investments companies) bonds and stocks and shares all offered the chance of a better return.
But that was before all the recent uncertainty in the economy. Investors have always been warned that the value of their stocks and shares could go up as well as down but for several years that warning seemed irrelevant. And then the markets fell. Those who didn’t need to sell their holdings because they didn’t need the cash are currently sitting on investments of vastly reduced value – waiting for the market to bounce back.
And it will and that’s the best time to invest. But has that point has been reached? And in the meantime if you’ve got money and those bank and building society savings rates don’t seem very attractive what do you do?
Take advice. Talk to at least three financial advisers. Ask how they charge. Tied advisers get commission from the companies they sell for. Independent advisers may be on commission or may charge a fee up front. You may feel happier with advice that you’re paying for directly.
Think about how much risk you’re prepared to take. Generally the more risk you take the higher the returns if your gamble pays off. But of course the higher the risk the more chance you may lose money in turbulent times.
Think about how long you can afford to have your money tied up for. Investments of this sort are long term because in most cases charges for administering and managing them come out of initial payments so it takes some time to make any return.
How much can you afford to invest and at what intervals? Are you looking for income or for capital growth?
What you invest in depends on all of the above. If you want to be sure the capital you invest will be safe you could go for bonds such as Guaranteed Income Bonds. They’re issued by insurance companies and pay a fixed rate of interest for a fixed period and you’re guaranteed your capital back at the end. The interest is paid minus income tax. The Newcastle’s Capital Safe Bond is a 5 year fixed term account. The interest is linked to the performance of 4 stock markets around the world including the FTSE 100 and the Nikkei 225. The initial capital invested is guaranteed. The Guaranteed Property bond is a fixed term account linked to the housing market. If house prices keep rising your interest goes up. If prices fall your original capital is still guaranteed.
The most risky investments are shares in individual companies. If you put all your eggs in one basket you leave yourself open to the greatest risk. Spread the risk. Buy in several companies in different sectors so that if one company or sector does badly it may be balanced out by another doing better.
Investment and unit trusts and Oeics spread the risk. You put your money into a fund along with money from other investors. The fund is used to buy a spread of equities. Different funds offer a different mix of companies and sectors - some invest in property or in overseas markets. Because your money is part of a bigger pot the whole amount can be used to buy reasonable numbers of shares. The bigger and wider the spread the more the ups and downs of individual company market performances are smoothed out. The level of risk you’re taking depends on which shares the funds hold.
Whatever you do has to be your own decision. That’s why it’s important to take a range of advice and don’t invest in anything risky if you can’t afford to lose.
Advertise with us  |  Privacy  |  Terms & Copyright                                                                                     Website maintained by USP Networks