Re: savings rates versus inflation

In message <5enkm3F39numvU1@xxxxxxxxxxxxxxxxxx>, Andy Pandy <spam8times@xxxxxxxxxxxxxxxxxxxxxx> writes
"Norman Wells" <norman@xxxxxxxxxxxxxxxxx> wrote in message
news:WtP$YgcGBYhGFwKs@xxxxxxxxxxxxxxxxxxxx

>
>RPI is currently 4.3%, most savings accounts don't pay 5.3%, that'd
be
>6.625% gross! Except for loss leaders like regular savers where
you
>can only invest a limited amount per month.

There are, however, one year bonds currently available at about 6.45
to
6.50%, including a Halifax web-saver 1 year fixed rate bond.

But they are fixed rate - at a time when interest rates are expected
to rise.

You don't understand the concept of 'factoring in', do you?

Interest rates on bonds do not go up or down with short term interest rate rises or falls, but with long term money lending rates - which take account of expected base rate changes.

You put an exclamation mark after "that'd be 6.625% gross!", as if that was totally out of the question. All I did was point out that you could get pretty close to that now, with no risk, and would certainly beat inflation after tax.

You can even get over 6% on several instant access accounts.

--
Norman Wells
NG
.