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• #1402
Thanks, that's the answer I have been looking for.
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• #1403
Is anyone here seriously saying they can outperform a guaranteed 3% pa over the next 2 years*?
I think the larger question is: if you are doing this
We still have a rainy day fund we'd be adding to whilst overpaying by almost 100%
is earning 3% actually winning?
I think overpaying by 100% is an indicator of the need to speak to an IFA or someone you trust who knows how to make money work for you.
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• #1404
Missed that last part. So possibly no. And yes at this point an IFA would be the smart move. Not earning any interest = losing money. Something my ultra-numerate, but risk adverse OH refuses to acknowledge.
But my main point is I always think investment horizon should be one of the first questions.
I would also probably also work out exactly how much is needed in the rainy day fund (factoring availability of cheap debt).
Something else people don't like the feeling of is insurance. Which an IFA can help with. Not as relevant here as there is a defined objective of increasing LTV to reduce future interest rate.
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• #1405
I did speak to a financial advisor about 9 months ago, but our situation and short/medium term plans then were quite different to now. Will see if she's on Zoom.
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• #1406
Actually, that reminds me. I have a house deposit earning nothing. What risk averse, boring option can I use that will let me get to the money quickly?
Cash ISA?
https://www.moneysavingexpert.com/savings/best-cash-isa/ -
• #1407
In the long term
Where long-term is > 10 years, preferably > 25 years
In a pension fund, say, where you also can gross up the contributions and defer income tax to when you are probably going to be paying a much lower rate.
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• #1408
Another option worth looking at for short term can be premium bonds, this calculates what your returns are likely to be and can do different cases on tax rate etc.
https://www.moneysavingexpert.com/savings/premium-bonds-calculator/
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• #1409
A moderately well selected moderate risk s&s isa will do 3% in that timeframe.
There is a small chance it will not, roughly the same chance that your 10 or 20 year investment will tank the month before you divest it.
There’s a bigger chance it will do more than 3%.
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• #1410
https://www.nsandi.com/direct-isa
I've never heard of NS&I. Anyone used them?
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• #1411
They are the old Post Office Savings. It's a state owned quasi-
building society, that also flogs premium bonds. -
• #1412
NS&I is both a government department and an Executive Agency of the Chancellor of the Exchequer
I think it’s fair to say some people do :)
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• #1413
I'm forrun muck, I don't know what all those words mean.
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• #1414
quasi eh? I like it! Put me down for 1400 of them!
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• #1415
Ok, looks like I might start up an ISA soon. At the very least it'll remove a bit of the all-the-eggs-one-bastard problem I have at the moment.
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• #1416
Ours with Vanguard is 16% over the past three years, which was more like 20+% at points before C19 but even so has paid for a new boiler and helped us through unpaid maternity leave. The money is fairly quick to access (although not instant) and actual emergencies go on a credit card until the transfer comes through.
There was a big C19 dip at some point (right when we needed the boiler) but it bounced back within days so maybe we’ve been lucky with timing. -
• #1417
That calculator is way off, based on what me and four others have experienced (possibly a too small/unlucky sample). In the last two years I've won roughly one quarter of what they suggest.
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• #1418
Yep there are some reasons to be cheerful. It's not all total gloom and doom.
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• #1419
I won £100 in my first month with £100 of bonds. (cool story)
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• #1420
3% is quite expensive for a mortgage at the moment so you should be able to get this down to 1.3-5% if you move down in LTV ratio.
Once you get down to a low cost mortgage that's the point to question whether repaying is a good option. For example you can risk free get 2.5% from regular savers so makes sense to use these rather than repay once you get down to a 1.5% mortgage.
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• #1421
Yep, no problems putting money elsewhere when we're on a better rate. Got 3 years left on the current rate though.
I have opened up a Nutmeg S&S ISA as there was £100 free cashback.
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• #1422
Is the break clause very expensive? No harm in asking your bank if they can put you on a better deal.
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• #1423
I have opened up a Nutmeg S&S ISA as there was £100 free cashback.
Too late for me to give you a referral code I guess...
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• #1424
What's Nutmeg rate like compared to NS&I and do I also get $100 cashback?
Aren't the key facts here:
and
?
Is anyone here seriously saying they can outperform a guaranteed 3% pa over the next 2 years*?
*as in these next two years following on from C19, Brexit, Trump's unencumbered rule, and China's pre-C19 slowdown