I hope you didn’t shift it into a cash ISA on the day of this post, just before this week’s mini-rally!
Low interest rates on savings
- Thread starter AnnO'Neemus
- Start date
tommers
Fuck it, it's fine.
Haha no. I'm going to leave it and see what happens. One day it will go up.
Back above the red line now anyway.
Hollis
bloody furious
On a recommendation been reading bits of John Bogle 'The Little Book of Common Sense Investing'
The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits): Amazon.co.uk: Bogle, John C.: 8601415708783: Books
Makes a very persuasive case for low-cost tracker funds and keeping it very simple. I am periodically tempted to sell my active funds and just stick them in a Vanguard life strategy or similar.
Related to it is the 3 fund portfolio:
Uk equity tracker
Global equity tracker
Global bond tracker
With the mix depending on your risk/stage of life.
Of course, Vanguard LifeStrategy basically does this for you.
The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits): Amazon.co.uk: Bogle, John C.: 8601415708783: Books
Makes a very persuasive case for low-cost tracker funds and keeping it very simple. I am periodically tempted to sell my active funds and just stick them in a Vanguard life strategy or similar.
Related to it is the 3 fund portfolio:
Uk equity tracker
Global equity tracker
Global bond tracker
With the mix depending on your risk/stage of life.
Of course, Vanguard LifeStrategy basically does this for you.
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That mix is what I would generally recommend to people who don’t want to spend a lot of time tweaking the whole thing for their personal circumstances (quite probably for a lower expected return, but with a risk profile that matches their own a bit better). Although I don’t think that the bond tracker is the best option for bonds. Active bond funds aren’t much more expensive than trackers and they can actually add a lot of value.
My personal nuance is down to the fact that I ultimately want the portfolio to provide me with a retirement income, and I want this to be via distributions (as opposed to volatile capital growth that I have to realise by selling things). To get this I’m trying for a spread that aims for about 3.5% income yield plus another 3.5% capital growth.
I think I can get this long-term strategy via a set of funds that roughly breaks down as follows:
- 20% UK equity income funds (including a UK Equity Income Index tracker)
- 25% global equity income funds (heavily diversified — typically 50-150 holdings per fund. I can’t find a reliable tracker for high-income global equity, else I would use it)
- 18% other global equity funds (to bulk out the capital growth, heavily dominated by trackers)
- 20% individual smaller specialist regional and industry sector equity growth funds (individually chosen either because I think the region/sector has high growth potential or because it historically provides heavy diversification from the rest of the portfolio)
- 17% bond income funds.
gosub
~#
NS&I joins the fixed savings rate bloodbath with massive cut NS&I joins the fixed savings rate bloodbath with massive cut
Would say rates coming down coz money flowing back into bonds. Expectation of Central banks cutting. Stock market is also having its annual santa claus rally. Two ways of looking at that side of things lower rates mean more futurre gravy...or rate cuts is about economic damage limitation
Would say rates coming down coz money flowing back into bonds. Expectation of Central banks cutting. Stock market is also having its annual santa claus rally. Two ways of looking at that side of things lower rates mean more futurre gravy...or rate cuts is about economic damage limitation
CH1
"Red Guard"(NLYL)
There is a very good reason for this - NS & i were well above target in raising money from the savings public and their rates were impacting on the mainstream banks/building societies.
I renewed a fixed term ISA at 5.27% recently for 2 years. Five years was available for new money - but that has now been withdrawn (Halifax).
I don't think "bonds" have anything to do with it by the way. NS & i call their products "bonds", but they are not tradeable - so in my book they are "accounts"
Feeling a bit less stressed now?
tommers
Fuck it, it's fine.
Less pissed off.
Silas Loom
Advanced. Forthright. Signifficant.
“Financial planner” is a fairly generous description for a person whose Twitter profile makes it very loudly clear that he is a twat of the first order.
gosub
~#
You don't have to hit exact bottoms or tops, indeed you'd be a fool to think you can....the big boys have better tech and better connections in both senses of the word. But you can make that work for you....its the big players that set points of resistance and other big players that test them so in reality you get a short order double spike or trough at a change of sentiment
Hollis
bloody furious
Yeah - exactly.. for example I made a bit of money last 2 years with a FTSE 100 index tracker when it was trading within a range... settng sell points and buy points, and not investing too high a percentage of your 'funds' in case you do screw up the timing.
Conversely, I've been 'stung' investing in much hyped funds by the media which in retrospect were in bubble territory.. so I'd be far more wary of investing in something which has already had high growth.
Conversely, I've been 'stung' investing in much hyped funds by the media which in retrospect were in bubble territory.. so I'd be far more wary of investing in something which has already had high growth.
teuchter
je suis teuchter
I've no idea what you're talking about.
Hollis
bloody furious
Some people tend to hold a percentage of their funds in 'cash' for opportunties. Some also take dividends as cash - so they're getting a steady stream of cash which they can reinvest when they want.
Other people don't bother with any of this and just reinvest as and when they have cash... which may be just as good a strategy depending on whether you want to play around with 'timing' or just forget about it and rely on the law of averages.
I largely follow the second of these, but from time to time I do play with trying to time things with a small percentage of funds.
When I'm doing this, I would tend to look at buying when something has fallen in value alot... so an index is 5% off a recent peak then you might start looking at it.
I also have a look at 'Relative Strength Index' which is a technical tool which looks at the momentum of price changes... but ultimately I wouldn't remotely claim to be engaging in anything other than glorified guessing.. which sometimes works, sometimes doesn't.
I would also never do this with individual stocks as this just seems far riskier, and I lost a fair amount of money during the dot.com boom doing this with one stock
Other people don't bother with any of this and just reinvest as and when they have cash... which may be just as good a strategy depending on whether you want to play around with 'timing' or just forget about it and rely on the law of averages.
I largely follow the second of these, but from time to time I do play with trying to time things with a small percentage of funds.
When I'm doing this, I would tend to look at buying when something has fallen in value alot... so an index is 5% off a recent peak then you might start looking at it.
I also have a look at 'Relative Strength Index' which is a technical tool which looks at the momentum of price changes... but ultimately I wouldn't remotely claim to be engaging in anything other than glorified guessing.. which sometimes works, sometimes doesn't.
I would also never do this with individual stocks as this just seems far riskier, and I lost a fair amount of money during the dot.com boom doing this with one stock
gosub
~#
the thinner blue line is actual (theoretical data) it'll bang on the top and the bottom a couple of times as people put more thought into whether market makers are right or not and pile in behind them.....
\/(prefer this graph - for what they are actually trying to talk about)
smmudge
i know the smudge is true
Bit weird that he calls himself a financial planner but doesn't appear to have any recognised financial planning qualifications...
teuchter
je suis teuchter
And you reckon you can watch stock markets and reliably identify where things are on that notional graph at any moment in time? I assume you are therefore a billionaire and/or you would like to recommend I sign up for your online course "how to beat the stock market: the secrets revealed".
the thinner blue line is actual (theoretical data) it'll bang on the top and the bottom a couple of times as people put more thought into whether market makers are right or not and pile in behind them.....
\/(prefer this graph - for what they are actually trying to talk about)
gosub
~#
Nope. You are better off looking at psychology at the mo than fundamentals though. Granted we ain't in the spot I thought we were..If you'd had out when i said market has gone higher (though much like highest box office in cinema I'd fucking love to see a a s&p or dow price in relation to a Freddo) cos without that it puts markets at Euphoria...and we ain,'t it's complacency or anxiety IMO..but if you had ridden that trade point and paid attention youd have done OK. Nay sayers that squeezed that thread , ignored several bank collapses and ignored the very idea of taking quarterlies into account...pity, thread title was probably right (some serious politics that could be thrown at that there..but quite a decent bearish haven throughout the economic cycle that's happened since.)
I ain't selling you anything...A man believes what he wants to believe and disregards the rest...so the song goes. The rate cuts of next year are damage limitation not gravy ahead.
The excitingly named Alan Smith is just making the banal but reasonable point that, by the very nature of what is driving the movements in the first place, hype will tend to push selling when things drop (and push buying when things rise). But if you buy into the idea that the stock market will rise over the long term, don’t lose heart just because it has dropped in the here and now. That drop is just part of the process, and can be seen as an opportunity if you have money to invest.
The thing that is missed from this analysis is that “the market” isn’t some external force of nature that just does its ineffable thing, leaving humans to ride it as best they can. The market is made by the practices of the humans that are constructing it. Booms are created by the same practices that lay the seeds for the coming bust. For the likes of you and I, that changes nothing. Invest what you can afford to for the long term and try not to worry. But as a piece of social critique, I think it’s important not to let market essentialism go unchallenged.
The thing that is missed from this analysis is that “the market” isn’t some external force of nature that just does its ineffable thing, leaving humans to ride it as best they can. The market is made by the practices of the humans that are constructing it. Booms are created by the same practices that lay the seeds for the coming bust. For the likes of you and I, that changes nothing. Invest what you can afford to for the long term and try not to worry. But as a piece of social critique, I think it’s important not to let market essentialism go unchallenged.
Puddy_Tat
naturally fluffy
this thread seems about the best place to ask -
what are you supposed to do about telling the tax-person about interest on savings?
my understanding is that building societies (etc) now pay interest gross, and you are responsible for telling the tax-person if it is above the threshold each year.
mum-tat thinks she will go above the threshold this year, and is worried about it all - she doesn't do a tax return, and can't set up an online account for tax, as she doesn't have a passport or driving licence to prove she exists. i don't enquire too closely in to mum-tat's financial affairs, but i doubt she will be in the league where she has to do the self-assessment thing.
i've suggested she just waits until she's got all the info for this tax year (one of them won't add interest until the end of march) and then writes to them, but she is concerned about getting in to trouble for not telling them sooner (i can't see how you can tell them sooner)
i've found this HMRC page on the web, but it doesn't really say what you're supposed to do.
what are you supposed to do about telling the tax-person about interest on savings?
my understanding is that building societies (etc) now pay interest gross, and you are responsible for telling the tax-person if it is above the threshold each year.
mum-tat thinks she will go above the threshold this year, and is worried about it all - she doesn't do a tax return, and can't set up an online account for tax, as she doesn't have a passport or driving licence to prove she exists. i don't enquire too closely in to mum-tat's financial affairs, but i doubt she will be in the league where she has to do the self-assessment thing.
i've suggested she just waits until she's got all the info for this tax year (one of them won't add interest until the end of march) and then writes to them, but she is concerned about getting in to trouble for not telling them sooner (i can't see how you can tell them sooner)
i've found this HMRC page on the web, but it doesn't really say what you're supposed to do.
smmudge
i know the smudge is true
My basic understanding is that the banks pay gross but still report interest to hmrc. Then if you have employment earnings or pension income, any savings income that goes over the threshold is taxed by adjustment in your tax code the next tax year. You only need to do a self assessment if your savings/investment income goes over £10,000.
Yes they can change your tax code earlier if you set up a government gateway and tell them through there. Or yeah can write to HMRC with the banks, account numbers etc but it's not required.
Remember that as well as your £1000 allowance for basic rate tax payers, you also get a starting savings rate of £5000 IF your other income is under £12,570. (Take off £1 for every £ over that until its all gone by £17,570.)
Yes they can change your tax code earlier if you set up a government gateway and tell them through there. Or yeah can write to HMRC with the banks, account numbers etc but it's not required.
Remember that as well as your £1000 allowance for basic rate tax payers, you also get a starting savings rate of £5000 IF your other income is under £12,570. (Take off £1 for every £ over that until its all gone by £17,570.)
Puddy_Tat
naturally fluffy
the page i linked to says you need to pay income tax on interest if it's more than £ 1,000 in a tax year, but says you only must register for self assessment if it's more than £ 10,000 in a year. it doesn't really say what to do if it's between the two which I think is the league mum-tat will be in.
i might try that when i've got an hour or two to spare
i wasn't sure about that - i can't remember giving national insurance numbers to banks etc, but might have done as part of proving identity or something.
snag for mum-tat is (if we have understood it right) you need to prove your identity with a passport or driving licence (neither of which she has) to set up a government gateway account.
i think i have done similar in the past (I did have a few years where i was doing self assessment, as i had a fairly unsuccessful spell of self employment alongside a few part time / temporary jobs) and think i just told them the total amount and they didn't ask for detail.
thanks. i think her income is probably above that - she gets a full state pension based on dad's NI contributions, and gets a work pension from his former employer.
that's what i have suggested, but she is concerned that's not enough / not soon enough / that she Will Get Into Trouble
