5.4% tax free saving.....No Martin

sabretoothtigger

Dont invest based on headlines, the devil is always in the detail. These are 1% plus maybe more, some people think it'll be alot more but its pretty low risk and a decent way to save i think

Blairweech

I agree with previous posters-Martins headline is misleading, I was going to invest based on it but realise now it's been explained correctly that that is wrong.
Anyway, I am saving up for a house deposit and was just going to buy £100 worth of these at a time...can I do that, or is that not how they work?

Kavor

Blairweech wrote: »

Anyway, I am saving up for a house deposit and was just going to buy £100 worth of these at a time...can I do that, or is that not how they work?

The minimum purchase is £100, so yes, you could do that.

RayWolfe

Blairweech wrote: »

and was just going to buy £100 worth of these at a time...can I do that, or is that not how they work?

Yes you can, provided that you do not exceed £15K per issue.

sabretoothtigger

I think the main thing is to hold them for at least a year.
Also its only if you hold for the full three years that you get the full 1% each year, its less if you cash in early and nothing at all before the 1st anniversary

cestlavie

oh golly i am so confused. i was thinking abt putting a little aside on these, but i just don't understand these maths.

barak

barak wrote: »

cloudninety - The RPI is a value, not a percentage, so if the value has increased by 3%, you will get that 3% plus the 1%.

See http://www.statistics.gov.uk/downloads/theme_economy/RP02.pdf

[Hope that's the right table for I/L Certs!]

Edit: That is not the right table! It should be the RPIX.

http://www.statistics.gov.uk/downloads/theme_economy/RPIX.pdf

Sorry If I confused any others as well as myself. When I posted the above message I said I wasn't sure if I had found the right table. I then phoned NS&I to check and was told I had the wrong one, so edited my message. After reading later messages I have now phoned them again and this time was told that I had the right table the first time, so at least one their staff is under a misapprehension.

While speaking to them, I suggested that it might be helpful if the T&Cs referred to the actual table that is used, as just saying RPI can cause confusion. I was told they would pass my suggestion on.

artha

cestlavie wrote: »

oh golly i am so confused. i was thinking abt putting a little aside on these, but i just don't understand these maths.

Personally I'm not too sure either but only on when to buy. If the current RPI is a high blip leading to the misleading headline on this site then I might put off investing for a month or so to make sure I start at a realistic level for future RPI increases. On the other hand one might expect that if inflation is here to stay for the near future then this investment will beat it

JamesU

cestlavie wrote: »

oh golly i am so confused. i was thinking abt putting a little aside on these, but i just don't understand these maths.

No need to be confused or understand the maths. All you really need to know is that index linked certificates will give approx 1% interest + any % inflation from the time you invest until the time you withdraw (provided they are held for at least a year). It is a personal choice regarding whether or not inflation will be higher or lower in the future, nobody can predict this, only guess at the moment.

JamesU

JamesU

artha wrote: »

Personally I'm not too sure either but only on when to buy. If the current RPI is a high blip leading to the misleading headline on this site then I might put off investing for a month or so to make sure I start at a realistic level for future RPI increases. On the other hand one might expect that if inflation is here to stay for the near future then this investment will beat it

What high blip? There is no high blip right now.

For sure current %RPI at 4.4% is misleading as it refers to inflation over the last 12 months and not the next 12 months.

Some pointers on what is happening with RPI at present:


http://forums.moneysavingexpert.com/showpost.php?p=32308133&postcount=69

http://forums.moneysavingexpert.com/showpost.php?p=32093617&postcount=28


JamesU