New Savings Strategy Needed?

wolvoman

So with the cuts of rates on many current accounts I need to look for ways to better utilise our household savings.


Right now our annual savings income totals about £3k.


With the cuts in rates to TSB, Santander, Halifax & First Direct this income will drop to about £1,400.


Thinking it's time to plough more into the stock market, or perhaps even join the masses in a BTL?

jimjames

You've mentioned two vastly different options, both of which are nothing like cash savings accounts.


You can invest tax free in a S&S ISA, BTL is taxed and getting more heavily taxed. You have easy access to money in S&S ISA, BTL is dependent on selling property which could take months.


Plenty more things to consider but it really depends what you're looking for - just more income?

2010

wolvoman wrote: »

Thinking it's time to plough more into the stock market, or perhaps even join the masses in a BTL?

Just as they`re hitting record heights?

TheFinanceGuru

I wouldn't consider looking at the stock market currently, it has recently climbed to a record height and it won't continue to do that forever. I imagine there will be some form of correction in the next 6-8 weeks, at that point you could potentially look to invest.

Have you ever considered peer to peer lending? You can now invest through an ISA to make any gains tax free. It is something that is growing significantly and it is only going to increase. There are a number of different peer to peer lenders out there so do your research. Each one offers something different, so it depends what sort of return you are after and what sort of security.

You could also look into the world of peer to peer lending to purchase property. It means you can invest a minimal amount, gain a decent return and not have to worry about owning the property and the necessary upkeep that comes with it. Housecrowd is one of the latest into the market, and I haven't used them yet but plan to in the future.

If I was you I would be careful though, you have gone for something with no risk whatsoever, to looking at something could potentially carry a risk. Can you afford to lose the money? Lots to way up, but there are a number of different ways you could get a decent return on your money.

bigfreddiel

How often is this 'correction' in the stock market going to be mentioned? Seems like every few months for the last five or six years!

It's not going to happen. The correction will be tiny compared to previous disasters.

Why is that? It's because lessons have been learnt, it can't happen because of all the safeguards in place now.

Keep in investing, if you stop you will miss out the next big jump in value.

Cheers fj

ManofLeisure_2

TheFinanceGuru wrote: »

If I was you I would be careful though, you have gone for something with no risk whatsoever, to looking at something could potentially carry a risk. Can you afford to lose the money? .

Cash does of course carry a risk - the possible effects of Inflation upon that sum of money.

principa

TheFinanceGuru wrote: »

I wouldn't consider looking at the stock market currently, it has recently climbed to a record height and it won't continue to do that forever.

Adjusted for inflation and currency devaluation I don't think that the market overall is at a record high. You could invest in the ftse between 6500-7000 in years 1999, 2007 - when money was worth more!

jimjames

TheFinanceGuru wrote: »

I wouldn't consider looking at the stock market currently, it has recently climbed to a record height and it won't continue to do that forever. I imagine there will be some form of correction in the next 6-8 weeks, at that point you could potentially look to invest.

You talk about "the" stock market. You do realise that there are markets outside the UK and that stock market should be plural? How are those markets doing?

It's also reassuring that you know exactly when the FTSE will correct. Are you shorting the FTSE to benefit?

Thrugelmir

bigfreddiel wrote: »

Why is that? It's because lessons have been learnt, it can't happen because of all the safeguards in place now.

So when the herd starts running for the exits where's the lifeboat?

2010

bigfreddiel wrote: »

Why is that? It's because lessons have been learnt, it can't happen because of all the safeguards in place now.

You must be very naive if you believe that.

The lessons are awlays learned

---

until the next time.

Dird

TheFinanceGuru wrote: »

I imagine there will be some form of correction in the next 6-8 weeks, at that point you could potentially look to invest.

That's a pretty damn small time frame. Next 3 years, sure.

bigfreddiel wrote: »

Seems like every few months for the last five or six years! It's not going to happen. The correction will be tiny compared to previous disasters.

There was a FTSE correction in Jan-March this year. While not as big as others it was still 15% off.