TOT National Savings reduce interest rates

Between 1974 and 1978 inflation was 25% per year. IN just 4 years anyone with money in a deposit account effectively lost half their money. The same applied to people who thought they had retired comfortably in the late 1960's with a level (= non indexed) annuity or pension.

Open a Hargreaves Lansdown Active Saver and they do all the hard work.

Interest rates are effectively negative already. Inflation is destroying savings faster than the interest is increasing them.

Andy

alan_m wrote on 06/10/2020 :

Yes, but still much better than most at 0.7%.

Andrew presented the following explanation :

Interesting!

They aren't working very hard.

HL offer easy access 0.55% Newcastle offer 1.05% and guaranteed not to fall below BOE base + 0.8% before 1 Nov 2021 Cynergy offers 1.0% unlimited withdrawals.

HL offer 3 years 1.45% Secure Trust and UBL both offer 1.4%

HL do warn that as they charge the banks (ie they basically get an affiliate fee) the rates available through Active Saver may not be the same as direct from the banks.

I can see the benefit of the platform, but you;ve still got to check the rates and move the money around yourself AFAICS.

Raisin offer something similar.

Owain

But it's all pretty much a waste of time and energy IMHO. If you have even as much as £100k invested you're only fiddling around with the odd £500/year by swapping to the 'best' savings account.

currently offering 1 year fix at 0.5%

which is less than the more prominent Virgin Money at 0.6%

It's not unreasonable to assume that they had the same ratio a year ago when Virgin were offering me 1.05%

On the basis of what I can read in the marketing blurb without signing up:

no they don't, they just make it easier for you to move the money (not an insignificant advantage I'll grant you)

But you still have to do the research

That'll be by buying shares and risk them falling in value by 30%, or even

BTDTGTTSNA

chasing an extra 1% at the risk of losing 30% is not a great deal IMHO

HTH

tim

anyone who invested 5 years ago today in an average portfolio, is now looking at a 10% loss.

I'm sure that you can find people with 200% gains, but they were lucky, not the normal.

For many people it's too difficult to invest in individual properties.

And property funds are too lumpy and too illiquid (and some grossly mismanaged) to form a major part of ones investments

But a fairly average global tracker 80% equities would have given you

Ive averaged abut 11% in the last year.

But I am of necessity a more active investor, and I wouldn't touch a savings account...

its just a fancy name for a fund - there are plenty of funds out there

That is the point. That's the average. some fund managers are better than average, most are worse The key is to pick the ones who are much better.

Savings accounts are the worst possible place to have money (except current accounts)

How was one to know in advance to choose *that* particular investment, rather than all the others that would have lost value?

global trackers are simply tracking average investment value across the world, and provided the global economy does not collapse and everyone sell everything and buy gold, represents pretty much a stake in global industry.

Or you can invest in a fund with a fund manager who does know, because it is his (highly paid) job, and get better still.

No, it isn't a 'fund'. Your money is placed in a deposit account at the institution of your choice. HL just act like those money comparison sites and get a fee from XX building society or whatever, but the deposit account is in your name.

An advantage is that HL have done the due diligence on you, so you can open a Share ISA, dealing account or whatever very quickly if you wish to move into funds, investment trusts, ETF's etc. Assuming you haven't locked into a term deposit with cancellation charges.