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Index linked savings certs renewal
lemonjelly
Posts: 8,014 Forumite
To my shame 
I've had an offer from NS&I to renew an ILSC I obviously took out 2 years ago...& forgotten about
(nice suprise though).
I'm being offered:
year 1 inflation proofing + 0.9%
year 2 inflation proofing + 1.11%
Do people reckon this is a worthwhile deal? Or is there better out there? My ISA allowance has been used, & I put £10k in an ILSC last november.
appreciate all responses...
I've had an offer from NS&I to renew an ILSC I obviously took out 2 years ago...& forgotten about (nice suprise though).
I'm being offered:
year 1 inflation proofing + 0.9%
year 2 inflation proofing + 1.11%
Do people reckon this is a worthwhile deal? Or is there better out there? My ISA allowance has been used, & I put £10k in an ILSC last november.
appreciate all responses...
It's getting harder & harder to keep the government in the manner to which they have become accustomed.
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Comments
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That's rather odd, I thought all ILSCs were 3 or 5 year, but the offer (RPI + 1% AER) is otherwise the same.
It depends on your view of inflation over the next two years. Personally I am pessimistic so would snap their hands off. The fact that returns are tax-free is a bonus for taxpayers. The added advantage of re-invested certificates is that you can cash in at any time and get index-linking, unlike new purchases which are only index-linked after one year. So what you have got now is effectively an instant access (well, 8 working days) account which will pay 5.1% AER (tax free) this month compared with the best instant access account 2.8% (taxable). Looks like a no-brainer to me. :j
EDIT: Note that interest rate varies each month in line with Retail Price inflation!0 -
I thought the same too (re 3 or 5 years).
Must be one I took out a while ago though...It's getting harder & harder to keep the government in the manner to which they have become accustomed.0 -
NS&I do a two-year fixed rate certificate. Are you sure this is not what is maturing? If it is a fixed rate certificate, make sure you instruct NS&I to move you to the index-linked version. If you do nothing the default option may be a fixed rate certificate with an appalling interest rate...0
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Sceptic001 wrote: »That's rather odd, I thought all ILSCs were 3 or 5 year, but the offer (RPI + 1% AER) is otherwise the same.
It depends on your view of inflation over the next two years. Personally I am pessimistic so would snap their hands off. The fact that returns are tax-free is a bonus for taxpayers. The added advantage of re-invested certificates is that you can cash in at any time and get index-linking, unlike new purchases which are only index-linked after one year. So what you have got now is effectively an instant access (well, 8 working days) account which will pay 5.1% AER (tax free) this month compared with the best instant access account 2.8% (taxable). Looks like a no-brainer to me. :j
Oooooh don't say that you will have the NSI vigilantes on your case
'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
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Sceptic001 wrote: »Ho ho, yes, I'm taking my life in my hands. I should have underlined the words this month!
Not good enough, you should have said if you have invested 12 months ago 'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
(well, 8 working days)
I think it's more like 13 (max)
YOu have to send off the form (say 2)
they take 8 days to initiate transfer (max)
then 3-4 days for BACS
This is worst case.0 -
It is definitely the end of a 2 year inflation beating index linked savings cert. It is about to reach its term, I can continue earning tax free* returns for a further term of the same length.It's getting harder & harder to keep the government in the manner to which they have become accustomed.0
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lemonjelly wrote: »It is definitely the end of a 2 year inflation beating index linked savings cert. It is about to reach its term, I can continue earning tax free* returns for a further term of the same length.
OK which one is it, the index linked are 3 and 5 years, here are their products.
http://www.nsandi.com/interest-rates'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
I'm sure lemonjelly is right. The NS&I calculator page gives 2, 3 and 5 year options. I can't find a comprehensive list of previous issues, but it looks like Issue 16 and/or Issue 17 were 2 year terms, which is why the 2 year renewal option has been offered.0
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