National Savings Index-linked Savings Certificates

[DimPrawn]

http://www.nsandi.com/products/ilsc/overview.jsp

Worth putting £15K into these rather than a bank account and paying 40% tax on the interest? Or big pile of pants?


Why choose this product? If you want to make sure your investment will grow ahead of inflation, tax-free

Who can invest? Anyone aged 7 or over; can also be bought on behalf of under-7s

Minimum purchase £100

Maximum £15,000 per issue

Investment term Choice of terms — currently 3 and 5 years

Interest Index-linking to Retail Prices Index (RPI) plus guaranteed interest on top. No index-linking or interest will be earned on Certificates cashed in within one year of purchase.

Tax status Tax-free


3-year 15th Issue

purchase price + Index-linking for year 1 + 1.1% of purchase price = 1st anniversary value

1st anniversary value + Index-linking for year 2 + 1.3% of 1st anniversary value = 2nd anniversary value

2nd anniversary value + Index-linking for year 3 + 1.66% of 2nd anniversary value = maturity value

[DimPrawn]

Oh and these too.


http://www.nsandi.com/products/fisc/index.jsp

http://www.nsandi.com/products/fisc/rates.jsp


Could stash a few bob in all these tax free.

It's all very well having money in high interest bank accounts but the tax man taketh 40%, reducing the rates to less than RPI.

[Bagpuss]

kaupthingedge are paying 6.5 % gross, even if you are higher rate it's still better

[Bumfluff]

ICE save doing a fixed term bond at 6.7% for 6 or 12 months, I've stuck a load of cash in there.

[Bagpuss]

ke is 6.86% 12 month bond

[Bumfluff]

ke is 6.86% 12 month bond

Thats good deal as well, Im just weighing up whether to put all my savings in an offset mortgage, first direct doing 4.75 and 5.25 fixed on the offset at the moment need to do the figures. I put a stash in the 6month term though with ICESAVE,

[AtW]

20% if you invest into subprime derivatives...

[DimPrawn]

kaupthingedge are paying 6.5 % gross, even if you are higher rate it's still better

Surely if you are a 40% tax payer then 6.5% equates to 3.9% after tax.

So a NS&I cert at RPI + 1.5% is paying about 5.5%?

[thunderlizard]

Tax status Tax-free

so the government say "Lend us your money, and we won't charge you for the privilege"?

How uncharacteristically generous of them!

[GreenerGrass]

Surely if you are a 40% tax payer then 6.5% equates to 3.9% after tax.

So a NS&I cert at RPI + 1.5% is paying about 5.5%?

Yes, you'd have to be earning a fair bit more than 6.5%, and if rates come down and RPI goes up then NS&I index linked certificates will be better than a Cash ISA.
I have a few grand in one as I hate declaring anything on tax returns.

What with holding a gold ETF in your ISA you should be well placed to survive the coming economic collapse, although Britain is of course well placed to weather the storm due to it's low inflation and strong economy.