NS&I index linked savings certificates

kidmugsy

zippy1973 wrote: »

Mine are due to mature in February. Do you get the same deal if you roll them over for another term? Think I'm getting inflation rate plus 1% ontop

(i) small beer - poorer return: RPI + 0.25%
(ii) Big deal - severe penalty if you withdraw cash early: all the inflation-linking on all the money on the certificate for the (anniversary) year of the withdrawal. Plus some extra little penalty on the interest.

They are now a much less attractive proposition.

zippy1973

Yeah, 0.25% ontop is not attractive at all. Thanks for the reply

grey_gym_sock

even at 0.25%, i think it's still a good option if you're after risk-free preservation of the real value of your money.

and, given the new penalties for early withdrawals, if you're confident you'll keep them for the full term.

if you want higher returns, and are prepared to take more risk to achieve them, then look elsewhere. but it does often make sense to part of your capital in something risk-free, part in something riskier but higher-return. different proportions will work for different ppl.

if you do take money out of IL certificates, it's very uncertain when you might get the chance to buy any more of them. it's over a year since they were accepting any new money.

zippy1973

Thanks for the reply. I invested £8k in 2010 for 3 years and using the calculator its currently sitting at around £9.2k. It was an inheritance from when my gran died and happy to keep the money tucked away for a rainy day so will probably just roll it over

kidmugsy

grey_gym_sock wrote: »

...
and, given the new penalties for early withdrawals, if you're confident you'll keep them for the full term.
...
if you do take money out of IL certificates, it's very uncertain when you might get the chance to buy any more of them. it's over a year since they were accepting any new money.

I think the key is that you need to be confident that the only withdrawal that you will want to make would be (i) all the money, and (ii) close to the start of the anniversary year. That way the severe penalties are reduced as far as possible.

So far I have rolled over one certificate not least because, as you say, I'm not confident that I'll be able to buy new ones again. But I'm less enthusiastic than I used to be - the previous terms were remarkably good.

fizzypop

My 3yr. IL certificate is due for renewal on 23 Jan 2013.
The renewal form has a box for renewal for a different term, does this mean I can renew for one year or am I restricted to just renewal for the same term as there are no issues currently on offer?

Nearing 70 years of age I am wondering whether it is worth renewing at all ... I have no immediate need to cash in. I am aware that inflation may take off like a rocket with QE when IL may make more sense.

Is IL still RPI or is CPI now the base line?

Thank You

kidmugsy

fizzypop wrote: »

My 3yr. IL certificate is due for renewal on 23 Jan 2013.
The renewal form has a box for renewal for a different term, does this mean I can renew for one year or am I restricted to just renewal for the same term as there are no issues currently on offer?

I wanted to change the term: I phoned to ask and I was told "no".

Sceptic001

fizzypop wrote: »

My 3yr. IL certificate is due for renewal on 23 Jan 2013.
The renewal form has a box for renewal for a different term, does this mean I can renew for one year or am I restricted to just renewal for the same term as there are no issues currently on offer?

I thought you got a choice between 3 or 5 years. [STRIKE]If the info they sent doesn't make this clear, maybe this option has been withdrawn.[/STRIKE]

fizzypop wrote: »

Nearing 70 years of age I am wondering whether it is worth renewing at all ... I have no immediate need to cash in. I am aware that inflation may take off like a rocket with QE when IL may make more sense.

What else would you do with the money? If not likely to be needed for three years you are unlikely to find anything currently on offer better than a guarantee to beat inflation (and tax-free).

fizzypop wrote: »

Is IL still RPI or is CPI now the base line?

Still RPI

ozzage

I have my renewal papers in front of me and I can definitely renew for a different term.

I have three options:
1. Renew again for 3 years at +0.25% (automatic if I do nothing)
2. Renew for 5 years at whatever rate is on offer at the time of expiry
3. Cash in

Options 2 and 3 require me to send in a completed form.

musehead

I've recently renewed two of my old 3-year terms for a further 5 years.