Safest method of saving

iilg

Sceptic001 wrote: »

They are, quite literally, as safe as the Bank of England. The question is, how safe is the Bank of England?

They are government gilts and can be purchased in the same way as fixed rate gilts, or you can get them through an etf such as ishares

In a nutshell what's the difference between fixed rate gilts and index link gilts in as far is which would be a better buy at present?

Sceptic001

The coupon (interest rate) and principal of Index-linked gilts move in line with the Retail Prices Index so at times of high inflation offer protection that ordinary gilts do not. More details here: http://www.dmo.gov.uk/index.aspx?page=Gilts/Indexlinked

iilg

Sceptic001 wrote: »

The coupon (interest rate) and principal of Index-linked gilts move in line with the Retail Prices Index so at times of high inflation offer protection that ordinary gilts do not. More details here: http://www.dmo.gov.uk/index.aspx?page=Gilts/Indexlinked

Thanks. So now better theoretically to go for ordinary gilts?

leonemallen

A base saving account is usually opened when a person joins any credit union. Savings account, an individual's association account, is meant for saving the deposits of people and is acknowledged as very liquefy investment, which generally accrues around an annual interest less than one percent. The fact is that you would be less liable spending it, and putting the money in your saving accounts is much safer since it is covered. Consequently, it is inexpensive, convenient and secure method for saving your money as savings account is a greater place in order to start your savings. Savings account concerning education is an educational savings plan that is set up as well as managed by guardian or parent to benefit a minor. One of the finest methods for starting a personal program concerning financial management for future is to acquire personal account for the purpose of saving your money.

Zither

Hi guys, just to say thanks for your opinion. Perhaps i'm being too paranoid after all!

Yeah the amount I have isn't over £50,000 so should be covered by compensation scheme. God knows how the government could afford to cover all the savings though!

glider3560

Zither wrote: »

Yeah the amount I have isn't over £50,000 so should be covered by compensation scheme. God knows how the government could afford to cover all the savings though!

The scheme isn't funded by the government. It is paid for by a levy on all financial services organisations that operate in the UK.
http://www.fscs.org.uk/what-we-cover/about-us/how-we-are-funded/

opinions4u

I think point 5 in this linky answers the question fairly well.

Amounts owed to the failed firm (for example, loans, mortgage or credit card debts) are taken into account before any compensation is paid.

If you are a borrower with the same firm this may affect the amount you can claim, as the amount of your deposits may be 'set-off' against any amounts you owe.

If a firm were to fail, FSCS would consider a depositor's overall net claim, which would include taking into account any amount owed which the firm may set off.

In the event that set off is applied, and if the borrowings exceeded the depositor's savings, there would be no overall claim against the failed firm, and the depositor would not be entitled to any compensation.

For example, if a depositor had a mortgage of £200,000 and savings of £150,000 with the same bank, set off may be applied by the Insolvency Practitioner dealing with the bank failure. As a result, the depositor may end up owing the bank £50,000, so there would be no positive balance and no claim for compensation.