Interest rates just getting worse!

polymaff

Malthusian wrote: »

It will happen in the sense that the FSCS will bail out the depositors, which I think is what polymaff meant.

Yes, and also that fscs would not be able to bail out, say, LBG's depositors.

dosh37

I'm in a similar situation to the OP.


In my case I have two fixed rate bonds maturing this month.
Both are close to the FSCS compensation limit and were paying around 2%.


It's difficult to know which way interest rates will go over the next few months.


I can see three options:-
1) Open a couple of new 1 year bonds. The best currently offer between 1.7% and 1.8%

2) Open a couple of temporary easy access accounts paying around 1.45% and hope that rates improve. Then move the money into fixed rate bonds.

3) Hedge my bets and put half in a 1 yr bond and half in an easy access account.


Option 3 is probably the safest bet.

wiseonesomeofthetime

Option 3 is my call

payless

Not brexit related.. think Uk savers have it tough ... . have you seen the saving rates in Germany !

Thrugelmir

dosh37 wrote: »

It's difficult to know which way interest rates will go over the next few months.

Take what you can while it's on offer. Rates are definately drifting downwards for 12, 15 and 18 month terms. I've split my savings to have constantly rolling maturity dates. Noticable how many lenders have pulled out of the market in the past few months and aren't competitive at all.

SPE57

Yes I think option 3 looks the best bet in the circumstance but have to accept pretty dire rates!

Bettie

I started a 120 day notice account with Paragon with a small amount of cash when it was 1.8% so when my two year fixed rate finished I added it to the same account. Its still 1.8% for the whole lot which is a bit better than easy access and not too far off the one year bond. Unfortunately they're now only paying 1.65% for new accounts.

LobsterMemory

So, if the OP takes up the 2.07% from Al Rayan, their interest rate has actually gone up.

quirkydeptless

LobsterMemory wrote: »

So, if the OP takes up the 2.07% from Al Rayan, their interest rate has actually gone up.

Yes, the Sharia compliant accounts are offering the best rates at the moment, albeit with it being 'expected profit'

However the OP stated "would consider the challenger banks but not African or Middle East owned. "

https://www.alrayanbank.co.uk/useful-info-tools/about-us/

"The parent company, and majority shareholder, of Al Rayan Bank PLC is Al Rayan (UK) Limited, the UK subsidiary of Masraf Al Rayan (MAR) Q.S.C.
MAR is a Qatar-based Islamic bank providing banking, financial, investment and brokerage services through a network of 12 branches located across Qatar. The Bank was incorporated in January 2006 and is licensed by Qatar Central Bank. MAR is the second largest bank in Qatar by market value."

jimjames

Unless it's emergency cash savings, in which case long term fixed rates probably aren't the right place to put your money then if you're repeatedly rolling over fixed rate accounts year after year then you may want to look at putting some of the money into investments to improve your returns.

There is a risk but if you don't need the money in the near future and can leave it for over 5 years if possible then it could be a good option.