Just had a message from my bank. My two savings accounts (emergency funds) now earn me 6% and 7% each.
I know long term that investing has historically returned 6-10% average returns.
I invest for a couple of reasons.
It’s better than overpaying my mortgage(1.09%)
Savings rates to this point have been abysmal.
I think we’re getting close to an inflection point here, particularly for 1, to have a guaranteed higher savings return.
For point 2, I still believe that investing provides a better return agains inflation.
Thoughts - will you be going for more cash this year?
1 Like
Those who were on the fence/risk averse that started investing for better returns may move back to savings, purely for the stability.
Where are you getting 6 & 7%? We all want to know…
Too much inflation to hold cash imo. And banks are not keeping my money safe.
I am actively seeking ways to disconnect from my bank.
You might find this video interesting
(ignore the click bait appearance, it is really well researched and you got the sources to read up below the video)
topher
February 14, 2023, 12:30pm
4
I’d imagine one is the 7% regular saver offered by First Direct – not sure about the other. It’s a good deal but there’s a £300-a-month maximum, so, in reality, you earn 3.75% on the total.
1 Like
Zrtz
February 14, 2023, 12:50pm
5
So here my current strategy, not advocating anyone should copy me.
Am not adding any new money into my S&S as have already maxed a while ago my 2022 allowance.
At the moment am simply finding the best savings rates (multiple accounts strategy) and letting the money build up.
If the stock market explodes upwards in 2023/2024, my S&S is there to capture the upside.
If the stock market nose dives heavily in 2023/2024 I will drip feed new money from my savings to my S&S to pick up discounts.
1 Like
stehuk
February 14, 2023, 1:23pm
6
If and when it gets to 8% or more I’ll probably save the maximum in a savings account. Until then I’ll stick with stock market investing.
topher:
not sure about the other
RBS/NATWest just upped their digital saver to 6%
Not when you blend it with a feeder account that also earns interest.
1 Like
Zrtz
February 14, 2023, 2:32pm
9
topher
February 14, 2023, 2:39pm
10
Fair point. I do this, drip feeding across from an easy access account. It brings the overall rate to roughly 4%.
1 Like
TInvest
February 14, 2023, 4:24pm
11
Nice!
Did you know you can set ypur (double) round ups to go to that account now as well?
And nationwide paying 5% cashback in supermarkets on their debit card.
1 Like
Did not know this thanks
I fill it up monthly anyway
Is it not more the average of both rates? I get say 3% easy access and 7% day dripping in, so being - tad under 5%?
1 Like
topher
February 14, 2023, 5:46pm
14
Yeah, 4% was way off – plucked that out of thin air.
Looks like it’s about 5% actually. That’s according to this drip feeding calculator at least.
topher
February 14, 2023, 5:49pm
15
Dougal1984:
Did not know this thanks
Me neither. Will take a look, thank you.
It’s a shame that Nationwide seems to have stopped its referral and switching bonuses.
1 Like
JB2
February 23, 2023, 1:25pm
16
Does that apply the other way round?
As in you borrow 1,000 at 5% and you pay it back monthly (the normal way). The total you will pay back in interest is £25.
Do you count that as 5% or 2.5%?
2 Likes