NS&I Index-linked Savings Certificates ??

[Deleted User]

Hi,

Can you invest in these if you've already used your tax free ISA allowance; and IF SO, is there a limit as to how much money you can invest in any tax year? I'm guessing you can't invest more than £15k in any tax year....?

Also.... if I initially invested say £5k, could I then invest a further £10k in that same issue at a later stage? (Based on £15k maximum per issue).

Hope these questions make sense! Thanks in advance :money:

ManAtHome

Only limit as far as I know is the £15k per issue - doesn't matter what else you've invested in tax-free products, and doesn't tie in with tax years (it varies quite a bit as to how long each issue lasts). Pretty sure you can top-up as long as you don't exceed the investment limit (which excludes interest).

Dunno if the rules have changed, but you used to able to roll-over any amount from previous NS&I issues (fixed or index-linked), the limits were only for new investments - similar to the ISA rules really.

StevieJ

The NS&I certs are nothing to do with ISA's, you can invest up tp 15k in each issue irrespective of tax year. If you were to invest now you could invest in the 3 yr 15k & the 5 yr 15k total 30k, if they brought out a new issue next week you could invest 15k in that. Yes if you have invested 5k in a issue you are still able to invest the outstanding 10k. If you are married your spouse can also invest their allocation.

[Deleted User]

StevieJ wrote: »

The NS&I certs are nothing to do with ISA's, you can invest up tp 15k in each issue irrespective of tax year. If you were to invest now you could invest in the 3 yr 15k & the 5 yr 15k total 30k, if they brought out a new issue next week you could invest 15k in that. Yes if you have invested 5k in a issue you are still able to invest the outstanding 10k. If you are married your spouse can also invest their allocation.

They sound almost too good to be true!; especially if there is NO limit regarding total amount invested; apart from the £15k per issue (Unlike ISA's). I wonder why you don't hear too much about them?; they sound like a great way to legally avoid paying tax on your savings! I guess the only "downside" is having to lock your money away for 3 or 5 years...

nrsql

You can redeem after 1 year and still get a good return - don't know if it would be tax free though.

They are based on RPI - if that drops then maybe they won't be so good but the tax free benefit is difficult to beat for a higher rate taxpayer.

>> !; especially if there is NO limit regarding total amount invested
They are basically loans to the treasury. The limit is controlled by closing the issue - the next issue may be delayed or at a lower rate.

ManAtHome

Well, I think we're only hearing about them as the BoE has allowed inflation to "do it's thing" (on the grounds that it may drop sometime in the next 20 years or so...). NS&I rates up to a couple of years ago were pretty carp - but the genie was still in the bottle then.

Basically it's a gamble as whether el Bank o d'Excess can continue banana-republic policies for the medium-term.

StevieJ

nrsql wrote: »

You can redeem after 1 year and still get a good return - don't know if it would be tax free though.

.

Yes still tax free.

IGK

ManAtHome wrote: »

Dunno if the rules have changed, but you used to able to roll-over any amount from previous NS&I issues (fixed or index-linked), the limits were only for new investments - similar to the ISA rules really.

Yes you can re-invest matured certificates, including interest. What's more you can choose what you want to re-invest in. This applies for fixed-interest certificates as well, so you can re-invest a maturing fixed-interest certificate into an index-linked one, and vice versa.
For example a maturing 3yr fixed certificate can be re-invested into 5yr index-linked.

Liz_the_Whizz

With latest predictions on Citywire of BoE interest rates rising to 6% and having to stay there till late 2008 to keep inflation at bay, NS%I Index-Linked certificates look an increasingly attractive prospect.

Certainly won't be cashing mine in just yet!