What is an investment trust and why would you want to put your savings into one? Hundredfold bitcoin the crises in Argentina and Turkey spell danger for emerging markets as the strong dollar stings?
MARKET REPORT: Paper and packaging firm Smurfit slumps 7. Spend your way onto the property ladder! I received a mailshot offering free entries into the National Lottery – is it a scam? Fed up with being hit by energy price shocks? Read this: Safer saving or wiser investing? Seven years of measly returns and the added insult of the recent Bank of England base rate cut are squeezing savers’ returns until the pips squeak. Then seek a better deal elsewhere.
75,000 under the Financial Services Compensation Scheme if a provider goes bust. There are comparable arrangements for non UK banks operating here. Not all banks are so tight-fisted and it is possible to boost returns by as much as a hundredfold by switching to the best paying accounts. The average rate on an instant access account is currently 0. But the best deals are double that, including 1. 2 per cent from RCI Bank, followed by Virgin Money paying 1.
Rates on such accounts are fixed. The best one-year deal is 1. 5 per cent from United Trust Bank, while Bank of Cyprus UK pays 1. 75 per cent for two years and 1. 85 per cent for three years. For savers happy to tie up cash for five years, banks Clydesdale and Yorkshire pay 2. Sheltering cash returns from tax remains the best savings strategy.
These popular accounts allow savers to have a flutter without risking their original cash. But when interest rates are low savers feel they are giving up less for the chance of a prize. Premium Bonds are not suitable for those who need to generate an income from savings or are worried about the long-term effects of inflation. Even at low rates of interest those with large nest eggs will soon exceed these allowances. With a cash Isa, all interest earned within the wrapper is tax-free. Cash Isas make sense for additional rate taxpayers paying tax at 45 per cent as it is the only way for them to beat tax on savings interest. They are excluded from the new savings allowance regime.