Force up interest rates

sabretoothtigger

innovate wrote: »

You can get 3.9% for 5 years, complete with £85K FSCS protection. Basically risk free, and no faffing about with double taxation challenges or exchange rates.

Punjab National International.

UK does have an exchange rate. The rate at which sterling exchanges for useful goods.

The exchange rate to oil, petrol, gas whatever fuel you need.

Are we trying to say these things are fixed because we stay at home. The risk is not free, it might be transparent to us but walking into a pane of glass can be painful this is not negated by our confidences in UK vs Australia

The risk taken is that in five years the exchange rate does not wipe out the interest given. It is quite a high risk.
ANZ on the other hand you have to risk not five years but can decide daily whether pull the money back?

Ukraine offers that much as they have higher inflation most likely. I will look up the history of both exchange rates.
The Asia pacific index invests largely in Australia, that is also my preference and they pay a decent dividend also. Anyone with business or holidaying down under probably has good reason to take the risk

innovate

sabretoothtigger wrote: »

UK does have an exchange rate.

Sure, but what does this have to do with GBP savings with Punjab National International? It's a UK bank.

gadgetmind

jimjames wrote: »

I'd think very few people need to be 100% in cash.

I'm currently at 10%, which is the lowest I've been for a few years. This is split roughly 50:50 between NS&I linkers and term accounts paying about 3.6%.

As I've reduced cash, I've gone into a combination of high-yield equities, preference shares and a few corporate bonds.

As accounts lose bonuses during the next 12 months, I'll probably reduce cash further, but perhaps consider moving more into cyclicals.

sabretoothtigger

innovate wrote: »

Sure, but what does this have to do with GBP savings with Punjab National International? It's a UK bank.

You missed my point. UK imports goods, you buy those goods. You are subject to exchange rates even if you never leave these shores, your money must do so

Its possible to lose more money in sterling then by buying ahead now and taking the money abroad.
The speculation then is how useful each country will be, Australia is apparently important to China who we in turn buy alot of things from

Will that continue, will UK become more productive. The chances imo of strong sterling are really low, we are tied to USA in our likely fate.
Maybe if we were somehow ascending with closer links to Europe or something like emerging markets even. This governments tenure started with a brief attempt at that but Ive not seen any hope since

innovate

sabretoothtigger wrote: »

You missed my point.

Yeah you are right, I am still missing it.

sabretoothtigger

I disagree when you said its risk free. It is simpler to stay in sterling and less effort but its not the lowest risk option

Bumping up the term to five years is really what makes it dangerous to presume that far ahead

People are better off paying off bills into the future as a way to increase security by reducing future costs. Since cash returns vs inflation have been negative in the past thats a reasonable option to fix a fuel bill or whatever can be done.

Its also likely future returns are negative also, taking 5yr and comparing it to now is a bad shortcut imo.