What Should We Do With Our Savings?

easynote

We have savings in the bank but the way the interest rates are we are not getting any returns, we have recently bought max premium bonds which we have got better returns off than money in the bank. My husband is wanting to buy gold with some of our money to keep it safe as he thinks our money will soon be worthless but will this be safe?

isofa

Why will your money soon be worthless? It might start to devalue slightly, until inflation falls (if your interest doesn't at least match inflation), but it won't suddenly be worthless...

The returns off Premium Bonds at present are very poor indeed, worse in fact, they have ever been (I think).

If you want to protect against inflation, which may well start to rocket after this downturn, try NS&I index linked savings.

You could look an investing some your money, rather than saving too.

ipri

Hi isofa.....I dont really understand all the current goings on...I'm also concerned about what will happen to my savings as I'm about to retire...I fear about comments that after a lifetime of work/saving it's all going to be near worthless!!...any reasurance would be nice! ta

wombat42_2

Savings will only lose value if the interest rate is less than the inflation rate. The inflation rate is likely to be very low for a year or two although you maybe be more worried, if say in two years time we get high inflation, say 15% and even high interest rates (say 8%) would mean you losing 7% per year.

ipri

Thanks...I was refering to the possibility the place going bankrupt....have heard comments on tv....I guess youre going to say ..in that case we're all in the **** then!!

Foggy

It's the 'printing money' scenario that worries me. I've tried hard to save and not join in the credit free for all but it seems that my spend only what I have philosophy may have been the wrong one.

ijs84

Given the recent market reaction to sterling, gold might not be a bad buy even though it is currently fairly high.

I'm not an investor though so don't go doing it because I think it might be a good idea. It's not a good enough idea for me to be comfortable putting my money behind it - that probably says it all

isofa

ipri wrote: »

Thanks...I was refering to the possibility the place going bankrupt....have heard comments on tv....I guess youre going to say ..in that case we're all in the **** then!!

UK banks (check, but most are) fully covered by the FSCS, so single accounts are covered to 50K and joint to 100K - but watch out because many banks own others, check the MSE table to see who owns what to make sure you are full covered. However so far the government has effectively guaranteed all monies over this FSCS limit, proven with the N+R collapse, B+B, Icesave etc. It's therefore set a precedent. Should a large name be in serious trouble, they will more than likely nationalise it.

Should the government not pay out if a large bank failed, then I think money really wouldn't be the most pressing issue, with widespread rioting everywhere!

MSE has a full article:Are you savings safe.

However just my opinions, always do your own research