MSE News: Would you lock savings away for 10 years for 4% interest?

dtaylor84

The interest is paid out monthly, so you can't even get compound growth... Seems like a pretty awful deal, really.

DotMatrix

What does the 10 year par rate yield curve look like. Only after viewing can you make a call if a good rate or not given market conditions.

Thrugelmir

dtaylor84 wrote: »

The interest is paid out monthly, so you can't even get compound growth... Seems like a pretty awful deal, really.

You can reinvest the income elsewhere.

Thrugelmir

talexuser wrote: »

Well if the average dividends from the FTSE are around 4%, you might think it's not that bad considering the risk difference?

How many shares are rated a buy with dividend yields of 4%?

innovate

Thrugelmir wrote: »

You can reinvest the income elsewhere.

But only as long as "the issue remains open for further investment". Which might be for the entire 10 years, but it also might not be very long at all.

ColdIron

Only 15 months ago you could get 4% for 3 years

temporary1

I suppose a number of surveys and consumer polls are being monitored by banks and building societies to see how low they can afford to drop their paltry savings rates to, before it finally breaks us and rouses enough of their fed-up and persecuted customers to withdraw and withhold their business - activating a generic banking rethink - and an automatic, inevitable and hasty increase across the industries' lending and savings rates.

My worry is that there are still some savers who are just so brow-beaten, apathetic, stubborn or stupidly compliant, that even savings rates of 0.1% wouldn't galvanise them enough to add their consumer power, to any communal series of strategic transfers and withholdings, in protest at the B.o.E cartel's current business model.

innovate

ColdIron wrote: »

Only 15 months ago you could get 4% for 3 years

And on small amounts, you can still get 4 or 5 percent today.

Plus, I am very much with those who suggested that if you are in it for 10 years or so, you will most likely be better off with investments. However, if I was 10 years older than I am(*), I might have a very different view - I might just be happy to pocket/spend my monthly interest and stuff any suggestions about investments.

(*)no point asking for my age

block10

"....has monthly interest paid into a separate account where you will then be able to access it."

Perhaps designed for savers wanting to live off the interest. Its not for me though.

Wilkins

Thrugelmir wrote: »

How many shares are rated a buy with dividend yields of 4%?

By me, quite a few. 40% of my portfolio, in fact.