How do you stay liquid without sinking?

King_Weasel

Few savings accounts match inflation. The best seems to be First Direct's 8% monthly saver, but you can only save £3600 max. Lloyds Vantage offers 4% on up to £21000 with conditions. (Gross rates quoted.)

I'm not a fan of fixed term bonds, partly because you risk missing out on higher rates in the future and partly because the whole sum is tied up for a year or more.

So what's the best alternative? Minimal risk, ready access and high probability if not guarantee of matching/beating inflation? (And that's the RPI, guys, not the CPI fiddle.) Is it still safer corporate bond funds. They were all the rage a year or two ago, but now?

Lokolo

Instant Access, wait for rates to rise, then get in there.

FLAPJACK

Go for the Vantage Accounts....4% instant access! Then as soon as Lloyds drop the rate thats the cue thats somethings about to happen to the base rate...and get ready to jump.

King_Weasel

FLAPJACK wrote: »

Go for the Vantage Accounts....4% instant access! Then as soon as Lloyds drop the rate thats the cue thats somethings about to happen to the base rate...and get ready to jump.

Been there, doing that. Keeping an eye on those rates. Anything else, anyone?

padington

FLAPJACK wrote: »

Go for the Vantage Accounts....4% instant access! Then as soon as Lloyds drop the rate thats the cue thats somethings about to happen to the base rate...and get ready to jump.

I say forget 'saving', its a losers game with inflation as it is and interest rates so low. Look into investing in shares which pay good dividends (think national grid sounds like goer) and hedging that with commodities on the rise (bullionvault.com) for gold and silver at the moment might be wise.

Take the first direct deal, thats worth it though. Do your research first also, just giving you an alternative perspective.

Mikeyorks

King_Weasel wrote: »

Anything else, anyone?

Move all excess cash into Funds ........ 18 months ago!

If you missed that boat .... and the following 12 months ...... then sitting on the cash fence in the interim means there's little else to do but tease out the last drops with the best easy access around? My residual cash is in either Lloyds at 4% or fixed rate ISAs ..... where the remaining 6% is heading for an end in 3 months?

So - like it or not - you have to 'fix' when rates are good. Then you forget about it. Otherwise you're always chasing 'maximum' ...... and you only ever get that if you're very lucky.

King_Weasel

padington wrote: »

I say forget 'saving', its a losers game with inflation as it is and interest rates so low. Look into investing in shares which pay good dividends (think national grid sounds like goer) and hedging that with commodities on the rise (bullionvault.com) for gold and silver at the moment might be wise.

Take the first direct deal, thats worth it though. Do your research first also, just giving you an alternative perspective.

Sorry, but I can't accept this advice for cash I might need at short notice. Show me a share that NEVER falls. Funnily enough, I'm showing a loss on my National Grid shares at the moment. I never saw the Rights Issue coming - did you?

frank2_2

RE: Lloyds Vantage offers 4% on up to £21000 with conditions.
21K? I thought after 7K Lloyds Vantage Current Account paid 0%? Did I miss something?

King_Weasel

frank2 wrote: »

RE: Lloyds Vantage offers 4% on up to £21000 with conditions.
21K? I thought after 7K Lloyds Vantage Current Account paid 0%? Did I miss something?

Yes - you can open three accounts!

padington

King_Weasel wrote: »

Sorry, but I can't accept this advice for cash I might need at short notice. Show me a share that NEVER falls. Funnily enough, I'm showing a loss on my National Grid shares at the moment. I never saw the Rights Issue coming - did you?

I'm showing a loss on all my savings accounts. The cost of living is going banana's here in london. A single bus fare is £2.20 these days. The gas bills have gone through the roof. The cost of running a car is getting worse and worse. I bought a shandy and a packet of crisps the other day and it came to £5.25.

4% is a loss with no hope whatsoever of being otherwise.

Also do you really need all your cash to be at hand? Cant some of it wait a few days ? As I said, just putting an alternative perspective.

In 2011 the word 'saving' doesn't mean the same as what it did.

Loughton_Monkey

The short answer is that we are all in the same boat. There are no magic wands. To get the best cash rates you simply have to 'do the work' of laundering your money around 'gimmic' 4%/5% current accounts or 'Reward' accounts. Or put it away into 3 year bonds. Maybe notice accounts, Regulare Savers etc....

If you have a substantial amount of cash, then an average of above 3% is still possible, but as we all know, that is a negative 'real' return. So 'we're all dooomed'.

Were there to be any magic solution, we would have latched on by now. Either 'invest' with all the risks. Or go 'safe' and lose spending power. Most of us do a bit of both.