NS&I 5 year index linked saving certs 2011 issue - half way point!

whattochoose

polymaff wrote: »

There having been quite a significant fall in the 12-monthly RPI, a £15k bond on the OP's timescale, using NS&I's projection assumptions, has dropped from a final redemption of £17,185.13 to £17,132.35

Oh well, I have £15000 invested too, and in these days of low returns I'll still be quite happy to receive £17, 132.35.

GreenBitterfly

I've got a £1000 invested, as I wasn't in work, and it was all I could manage at the time. Think I will roll them over next year, when they mature.

polymaff

whattochoose wrote: »

Oh well, I have £15000 invested too, and in these days of low returns I'll still be quite happy to receive £17, 132.35.

Remember that the OP had a five-year certificate bought in May 2011. The bulk of the growth happened during the first three years of the cert's life, so that £17,132.35 only applies to a cert bought at that time. To illustrate the point, the individual year growths were

3.57% 3.28% 2.45% 0.90% 0.78%
The last figure, of course, being an estimate.

Therefore a 5-year cert taken out in May 2014 will produce a significantly lower return that the 2.7% the OP- and I - expect to get.

Hope that the above still leaves you happy :)

whattochoose

polymaff wrote: »

Therefore a 5-year cert taken out in May 2014 will produce a significantly lower return that the 2.7% the OP- and I - expect to get.

Hope that the above still leaves you happy :)

Certainly does me old mucka.
I took mine out in 2011 too.:beer:

KTF

GreenBitterfly wrote: »

Think I will roll them over next year, when they mature.

I didn't think that option would be available?

masonic

KTF wrote: »

I didn't think that option would be available?

Existing holders can roll over their certs at present. There's no indication that the situation will change.

gadgetmind

whattochoose wrote: »

I took mine out in 2011 too.

We did five of them in 2011, two each for my wife and myself, and one for daughter. When they mature, I was going to roll them over, but may instead offset more mortgage, which is ours but used to loan (with interest!) to daughter for her house. She could use hers to reduce her loan from us, or stick it in her 123 account for the 3% interest.

KTF

masonic wrote: »

Existing holders can roll over their certs at present. There's no indication that the situation will change.

So you can. I thought you had to cash it in.

http://www.nsandi.com/index-linked-savings-certificates

Would it be in the same product as taken out in 2011 even though it isnt currently on sale?

masonic

KTF wrote: »

Would it be in the same product as taken out in 2011 even though it isnt currently on sale?

The renewal options are listed on that page you linked to. You have the option of the 3 year Issue 25 certs or the 5 year issue 52. The interest rates and terms have changed significantly since 2011. I'd suggest they couldn't get any worse, so I don't see any advantage in rolling over into the 5 year issue.

Glen_Clark

polymaff wrote: »

Remember that the OP had a five-year certificate bought in May 2011. The bulk of the growth happened during the first three years of the cert's life, so that £17,132.35 only applies to a cert bought at that time. To illustrate the point, the individual year growths were

3.57% 3.28% 2.45% 0.90% 0.78%
The last figure, of course, being an estimate.

Good Point. I think the fall in inflation over the last 2 years has been caused by the fall in commodity prices, particularly oil which has more than halved, wheat etc at a record low. Since commodities can't continue falling at that rate (or they would be paying us to take them away) I'm expecting inflation to pick up a bit, although I can't rule out further 'rebasing' of the statistics. The average house price has risen 10% in the last year, yet they say inflation is next to nothing. I have a diversified portfolio which includes these index linked bonds. If I knew which part of the portfolio was gong to do best I would sell the rest and put it all in that. But I don't know that, so will stay diversified