MSE News: Should you fix your savings at rock-bottom rates?

John_Clark

To take your savings out of the bank and stuff it under the mattress in the hope of raising interest rates, is ludicrous. In any case, inflation maters more to savers than interest rates. The way to make politicians take notice is to join their political parties and undermine them from within. But relatively few people bother to do that, or even to vote, so politicians get a free reign to do what they like.

beefturnmail

standinman2009 wrote: »

I cant help feeling its time for a savers revolt where we draw out as much of our savings out as possible for say a period between a week and a month ,even with funding for lending most banks would be crippled through lack of funds and something would have to happen ,ITS TIME TO ACT

Yeah let's cripple the banks. You're right something would happen - Oh dear, I can't withdraw my savings because the banks are crippled, and oh dear, I can't withdraw cash from my current account to buy food. Still, that showed them.

Gordon_the_Moron

yossarianuk wrote: »

The Santander 123 account pays 3% interest on a current account if you have more than 3k in it.

Also, and less mentioned, Lloyds Vantage pays 3% on balances of £3000 to £5000, you can have 3 of them (well you used to be able to, not 100% thats still the case!) if the cashback will wipe out Santander's fee then it is the one to go for as Vantage doesn't give cashback but if you pay few or no bills that would earn cashback Vantage has no monthly fee.

arcadia00

I just fixed for 4yr at 4.3% gross (4.05% AER) with Bank Of India. It was open in a week after I visited the branch. It is a gamble and I will live with it. Since they pay out the interest to you, you can reinvest it elsewhere and so technically boost higher the actual AER value somewhat.

richardlionheart

ViolaLass wrote: »

Where do we put our money for that period?

yes under the mattress at least it will be there in the spring

ViolaLass

richardlionheart wrote: »

yes under the mattress at least it will be there in the spring

As will the money in the bank - guaranteed if it's under £85k.

Eco_Miser

standinman2009 wrote: »

I cant help feeling its time for a savers revolt where we draw out as much of our savings out as possible for say a period between a week and a month ,even with funding for lending most banks would be crippled through lack of funds and something would have to happen ,ITS TIME TO ACT

Remember Friday 14 September 2007, and the queues down the street, as Northern Rock savers tried to do just that?

VT82

arcadia00 wrote: »

I just fixed for 4yr at 4.3% gross (4.05% AER) with Bank Of India ... Since they pay out the interest to you, you can reinvest it elsewhere and so technically boost higher the actual AER value somewhat.

Not sure how 4.3% gross is 4.05% AER?

Putting this to one side, unless you can reinvest the interest at a rate the same or higher than the fixed bond rate, the AER will be lower than advertised as a result of taking monthly interest.

VT82

But back on topic, savers are really wanting to have their cake and eat it.

In Islamic finance, it is against the 'rules' to just be given interest. In their equivalent of savings, both sides have to take some risk if they expect to get a return.

In stocks and shares investments, you can get a decent return over the long term by taking a bit of risk. And it's better for the economy than savings as it can be used to benefit all kinds of businesses, not just to allow house purchases.

To expect to be able to give your money to a bank, have them look after it for you, give you means of accessing it, taking the risk of lending it in big lump sums for the long term but giving you access to it, in whatever amounts you want, in the short term, have your savings 100% insured (up to £85k), and STILL demand returns that beat inflation? That's kinda ludicrous when you think about it.

guitarman001

standinman2009 wrote: »

I cant help feeling its time for a savers revolt where we draw out as much of our savings out as possible for say a period between a week and a month ,even with funding for lending most banks would be crippled through lack of funds and something would have to happen ,ITS TIME TO ACT

You're wasting your breath saying that to people on here. I'm with you, though.