Marcus and Paragon cut the interest rate. Where to invest?

wmb194

coachman12 said:

In the discussion between Malkytheheed and wmb194, I must agree strongly with Malky, both in terms of definitions which are not semantics  and in terms of  similar views and experiences on the actual substance of the facts outlined by Malky.

I don't understand what you've written or how it adds anything but you could try going back to basics. Ask yourself what a bank deposit actually is. Would you consider a gilt to be an investment? 

Apart from being off topic this is all moot anyway. Every portfolio has an element of cash so you may as well try to make the most of it and the OP was asking about savings accounts.

Malkytheheed

My point was simply that hoarding cash (which is what savings accounts is doing). Is not investing. It's just not. 

Also, in recent years (decades), interest rates on instant access account has tracked below inflation. Meaning you are actually loosing money long term by holding it in a pot. 

Yes I clarion for march was 1.5%, no suprise it dropped as there happens to be a global pandemic going on. If you look over the last 12 months it is higher. 

I'm just saying. If you have cash then yes search for the best interest you can get to diminish the effects of inflation.
But it's not investing. And you are not making passive income. You are, at best, just about breaking even. 

roddydogs

Wow!......

wmb194

Malkytheheed said:

My point was simply that hoarding cash (which is what savings accounts is doing). Is not investing. It's just not. 

Also, in recent years (decades), interest rates on instant access account has tracked below inflation. Meaning you are actually loosing money long term by holding it in a pot. 

Yes I clarion for march was 1.5%, no suprise it dropped as there happens to be a global pandemic going on. If you look over the last 12 months it is higher. 

I'm just saying. If you have cash then yes search for the best interest you can get to diminish the effects of inflation.
But it's not investing. And you are not making passive income. You are, at best, just about breaking even. 

*losing. Nobody is saying that stock market investments are bad. For all sorts of reasons, for instance if you're trying to build a balanced portfolio or you're saving for a deposit, people use savings accounts. The OP asked about savings accounts and didn't specify instant access. As I have said, there are and have been accounts paying more than inflation and I have one in particular which is paying 4% for another four and a half years - a real return and something the insurance companies would love to have themselves right now. 

"...in recent years (decades), interest rates on instant access account has tracked below inflation..." Definitely not decades and, if you made some effort, not even recent years. Before the 2008 crisis RPI was c.3% and it was easy to find instant access accounts paying 5%+. Since the crisis lots of regular savers and current accounts paid 5% and more. It's harder today but this morning I opened two instant access regular savers paying 2%. You're limited on the amount you can deposit obviously but some people don't have a lot of money.

Anyway, this has been fun but it's all a bit pointless and off-topic.