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Weekly Money: the stories we noticed 5 to 9 OctoberThe IndependentThe move is designed to simplify things for customers but Hannah Maundrell of said: “I will be interested to see if anyone actually sees their bill going down as a result of this”. Call rates are also changing with the connection fee for ...
AOL Money UKHorrifying ignorance among teachers on money mattersAOL Money UKGavin Oldham, Chairman of The Share Centre, said: "While the inclusion of financial education on the curriculum is a huge step forward, it's clear many teachers still lack the confidence to explain basic personal finance issues. This means pupils may ...and more »
Money ObserverHow to build a pension portfolioMoney ObserverHowever, if you have another 15 to 20 years until retirement and you don't invest your money where it can grow in real terms, your pension pot may end up being worth much less than you had hoped. .... He says: 'This type of fund provides a solid base ...and more »
How to Save Money -- 9 Money Saving Tips for AnyoneHuffington PostIf you have credit card debt and the interest payments are crushing your ability to pay off any principal, try to negotiate a lower interest rate with your credit card company. If your card issuer refuses to help you, transfer your balance to another ...and more » your first £10000: our precision suggested that "tracker" funds - which simply replicate the performance of a stock market index such as the FTSE 100 - could do much of the work and picked out the Fidelity UK Index fund (0.07pc, P share class) for the UK element. For international ...
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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.
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