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Old 09-23-2008, 07:49 PM   #21
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Default Re: savings account

I've got an ISA which allows on-demand payments and withdrawals with no strings attached and no minimum deposits at certain intervals, root is right that some banks do this but usually the student accounts are a bit more lenient because students don't necessarily have a regular income like an employed adult would.

My ISA is with the Skipton Building Society, if this helps.

I've also got Premium Bonds but those are great if you win, and only if you win. I won £50 this week and I'm not sure how much I've got invested because my dad set it up for me when I was younger, but my dad says that my gran has invested the legal maximum or close to it and she won £1000 in a lump sum last year and has won bugger all since. It's pot luck but quite nice if it ever pays off.
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Old 09-24-2008, 03:22 AM   #22
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Default Re: savings account

Go to the Casino and put it all on Black at the roulette wheel, will double your money straight away..........................................if it wins
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Old 09-24-2008, 05:28 AM   #23
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Default Re: savings account

Quote:
Originally Posted by tom-knox View Post
Guv Bongs?

Govermental Crack Cocaine?
Bad way to go with ur investment
Yer, I wouldn't ask you to where to place cash.

Who is slating the guv bonds? there safe, you have a chance at winning things.

Or would you just go for a boring 130pound a year with 2k stuck in the bank.

seems to me your only looking to make money, get a job or something.


If I had 2k and wanted to invest, I'd buy shares right this second in Royal bank of Scotland, this info is coming from the guy above me as he plays with stock all day lol
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Old 09-24-2008, 08:13 AM   #24
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Default Re: savings account

Well, I wouldnt invest in the Stock market right now. But the bond market is up. Usually the bonb market does the opposite of the stock market.

I have 200 shares in waste management. As well as the price of hte shares, I make bout $200 a year in dividends. But the stock is losing value a little bit. If you want to go long term, this is a really GOOD time to invest in the stock market. It's all cheap, and it will go back up. Just need to invest in a big company. Apple is doing well, walmart not too bad.
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Old 09-24-2008, 08:31 AM   #25
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Default Re: savings account

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Originally Posted by Antdemo View Post
Yer, I wouldn't ask you to where to place cash.

Who is slating the guv bonds? there safe, you have a chance at winning things.

Or would you just go for a boring 130pound a year with 2k stuck in the bank.

seems to me your only looking to make money, get a job or something.


If I had 2k and wanted to invest, I'd buy shares right this second in Royal bank of Scotland, this info is coming from the guy above me as he plays with stock all day lol
but the point is that you have a chance of not winning things as well. and all the time your cash is being devalued due to inflation.

I gave the example of £100 loosing about £3 a year in value due to inflation,
with £2000 you're loosing £60 a year in value due to inflation.

consider this, in the 60s a loaf of bread may have cost 5 pence, now a loaf of bread costs £1

(thus the value of money has altered significantly, 1p sweets are not 2p sweets, what would once have been enough money to buy a family a meal now can't even buy a candy bar).

so the point I'm making is that if you invested £100 in government bonds in 1960, but didn't win anything, you'd still have £100, that money would not have grown. and it's have been devalued so that it's only worth perhaps 20% of what it once was.

on the other hand, assuming that you had £100 put into a savings account with an APR of 6.5% since 1960 you'd have at least £2000 now, so your money would have grown.

bonds do work well for some people, they are a good way of playing a lottery with minimal risk, (i mean if you spent £100 on the euromillions lottery this week, you would win 20 million, or you could loose your £100).
but bonds are not for everyone, think about it, it's guaranteed that due to inflation your money will be devalued, but it's not guaranteed that you'll win the lottery -ever.

basically that lottery fund is created by the interest accrued on that money, you can't make money out of nothing. and for one person to win money, another person has to not win money, nobody can win all the time.

same with stocks and such, nobody there is printing money. people are only able to buy cheap stocks because someone else has taken the loss.

the only people that can print money is the Bank of England, and that's how you get the money on the interest, (well actually it's not, the banks play risky games with your money really instead of you having to).

having said that the ability to print money didn't actually help the bank of scotland, (halifax bank of scotland / HBOS) as they still had to be bought out.
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Old 09-24-2008, 09:22 AM   #26
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Default Re: savings account

Since when do you lose cash in guv bonds?

I just asked my boss and he said no if its guv bonds.

Their is a fixed rate on them he said, and also he said you don't make much, he also told me high tax payers win more cash.

Then I asked him this: Is my money safe their? answer: yes

you tell me root? lol

The stock/bond portion is different though. You CAN lose money in an ISA if you have stocks in it. That's why they recommend you do something like a GIC or a Bond where you're guaranteed a return off your investment.

^^^^ yahoo fftw
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Old 09-24-2008, 10:22 AM   #27
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Default Re: savings account

was my example not clear enough?

I elaborate on the statement on the NSI website
Quote:
Prize draws Instead of paying interest, Bonds are entered into monthly prize draws. Remember that inflation can reduce the true value of your money over time.
Assuming that you never win (which is a possibility).

your money, which never gathers interest over time is devalued due to inflation.

to elaborate this I put the example that if 50 years ago you invested what was then a considerable amount of £100 you'll never gather interest on that amount.

you never loose your hundred pounds either, BUT over time due to inflation your hundred pounds is devalued.

I drew the example of buying a loaf of bread,
in 1960 £100 could buy you two thousand loaves of bread, but now could only buy you one hundred loaves of bread.

so you are right, you never loose your cash in bonds, but due to inflation your money is devalued.

it's the same as if i bough 100 shares in HBOS five years ago when share prices were £10 per share. i'd have spent a thousand pounds then, but due to market conditions, my shares would have been devalued to the price of something like 85pence per share, so my hundred shares are now only worth £8.50.
I never lost shares, but my investment was devalued.

in bonds, you never loose cash, but the cash never grows and because of inflation is devalued.

there is a distinct difference I'll give you that, but the end result is the same.

if you put £100 into a savings account, in 50 years you'll have a couple of thousand,
if you put £100 into bonds in 50 years you'll still have £100... but that £100 will be practically worthless due to inflation.

(i.e the price of a loaf of bread (in 2008) has risen to twenty times the price it was (in 1960), if this happen again your £100 will only buy five loaves of bread).

so in real terms, you put £100 into bonds now, and in fifty years you still have £100, but due to inflation it's only worth what £5 is worth today.

this is a very very basic description of inflation and what happens to money over time when it's not invested.
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Old 09-24-2008, 11:11 AM   #28
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Default Re: savings account

YES I READ IT READ THIS: GUV BONDS

DIFFERENT FROM OTHERS! DUE TO ME SAYING GUV .

if you put £100 into a savings account, in 50 years you'll have a couple of thousand,
No you will not! 3pound a year you make from that, so in 50years you'll have 150pound.
if you put £100 in bonds then still you will have £100 + what ever you win. your money does not go lower.

http://www.financemarkets.co.uk/boar...-bonds-49.html

http://finance.yahoo.com/education/b...Types_of_Bonds

I hope you see where I'm coming from, and I don't mean to shout
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Old 09-24-2008, 12:22 PM   #29
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Default Re: savings account

OK, government bonds are different, but NSI bonds that you linked to and first raved about winning money from do work as I just explained.

but after that...
good god.
I can't believe I'm arguing the finer points of savings and interest with someone who doesn't even understand the principals of compound interest.

it works like this.
year 1 = £100
year 2 = £100 + 6.5% = £106.5
year 3 = £106.5 + 6.5% = £113.42 (i.e you earn interest on your interest from previous years)


to save me pushing all that into a calculator I made a little spreadsheet to figure it out for me.

as you can clearly see, at a rate of 6.5% £100 grows to be around £2000
(your remark that you get £150 over 50 years is wrong -you'd have earned £150 in interest at half way through year 12. and by the time year 50 came, you'd actually be earning £150 a year in interest payments alone).

And if interest rates went up, you'd be earning even more. (of course rising interest rates also means rising inflation so like I said earlier money is devalued).

2008 £100.00
2009 £106.50
2010 £113.42
2011 £120.79
2012 £128.65
2013 £137.01
2014 £145.91
2015 £155.40
2016 £165.50
2017 £176.26
2018 £187.71
2019 £199.92
2020 £212.91
2021 £226.75
2022 £241.49
2023 £257.18
2024 £273.90
2025 £291.70
2026 £310.67
2027 £330.86
2028 £352.36
2029 £375.27
2030 £399.66
2031 £425.64
2032 £453.31
2033 £482.77
2034 £514.15
2035 £547.57
2036 £583.16
2037 £621.07
2038 £661.44
2039 £704.43
2040 £750.22
2041 £798.98
2042 £850.92
2043 £906.23
2044 £965.13
2045 £1,027.86
2046 £1,094.67
2047 £1,165.83
2048 £1,241.61
2049 £1,322.31
2050 £1,408.26
2051 £1,499.80
2052 £1,597.29
2053 £1,701.11
2054 £1,811.68
2055 £1,929.44
2056 £2,054.85
2057 £2,188.42
2058 £2,330.67
2059 £2,482.16


even if we take the rate of interest that you seemed to pull out of nowhere, (£100 earns £3 so 3% (and that's below the base rate of inflation)) you'd still have £450 after 50 years -with compound interest, but I don't think you'll find a savings account that does only offer 3%). even my current account offers interest at 5%APR (4.3%AER), and specialised savings/building society accounts usually offer better rates of interest than current accounts.

personal insults aside, (I'm sure that as you are training in the finance sector you will one day learn about interest and compound interest etc).

do you really think that if savings accounts were worth nothing that they would still be the most popular way to save?

fair enough government bonds do provide a good and valid (low risk) way to save, and as you said, the more tax you pay the better your chances of winning.

so why do you consider these a good option for dude_se who says he's just going to uni, therefore is a student will likely only have a part time job and possibly a tax code of NT meaning that no tax is deducted from his earnings?
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Old 09-24-2008, 01:26 PM   #30
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Default Re: savings account

put my job aside, because theirs alot in accountants to learn for me only thing I worked out right now is VAT and bookkeeping, I have not learn tax codes, all this and that, but when I have I will know.

I picked it up wrong but on the bonds I knew what I was saying.

Anyway, indeed who could do alot with the cash, but I just told him a bond would be good. it doesn't mean he will not win anything, but its worth ago seen as all he will earn of his interest is around 130pound
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