Archive for the ‘interest rates’ Category

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What Is The Best Savings Rate Available Today you ask. Good question… and the answer is 6%. There are some regular savings accounts offering more than this but the headline rate is NOT the rate you will receive. Normally the catch is that you’re only allowed to save a maximum amount each month, not stick the whole sum of money into the account on day 1. Which means that you won’t really be getting the full 6% annual interest on your money… you’ll be getting a blended and lower rate.

This is how it works. Let’s say today is the 6th April, start of a new tax year, and you want to invest some spare cash in a cash ISA. Now the regular saver ISAs tend to insist on a monthly payment rather than a lump sum, thus the term “regular saver” in the title of the account.

So what happens is you invest £300 on 6th April, then another £300 on 6th May and so on until 6th March the following year when you finish the savings plan. What this means is that on the first deposit of £300 on the 6th April you will get paid 6% on £300 for the full 12 month term. On the second deposit of £300 on the 6th May you will get eleven twelfths (11/12) of 6%, the next month you get ten twelfths (10/12) of 6% and so on until you reach the end of the year. Over the year the AVERAGE rate of interest you receive will be lower than the amount you would’ve received had you just socked the full £3,600 straight into the ISA cash account on day one!

Conclusion: just be careful and know that the headline rate isn’t always the true rate of interest you will be receiving.

If you do want to invest some money and receive a REAL rate of return of 6% then sign up to my list (enter your name and email address in the boxes in the top right corner of this page) and I’ll send you details of a very secure and profitable way of earning 6% on your money.

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Breaking News: Bank of England Maintains Bank Rate at 0.5%

This morning on BBC Breakfast Television (www.bbc.co.uk/breakfast) Ray Boulger from Charcol (read his blog here: http://www.charcol.co.uk/knowledge-resources/ray-boulgers-blog/) mentioned that now was probably the best time to look at getting a fixed rate mortgage for a five year term minimum if you can. Yes the fees are quite high and Yes you may be locking into a rate that’s higher than the current pay rate on the Standard Variable Rate (or SVR for short) BUT if you can afford the increased rate, then what you are doing is effectively locking in your payments so that in the event that base rates go up (as I and others believe they will) you won’t be hit in the pocket with any nasty suprises!

Go and see your financial adviser/mortgage broker now and look at whether now is the best time for you to fix your rates. If you haven’t got an adviser and you live in London, contact me and I’ll give you the name of my personal financial adviser. Happy mortgage hunting!