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NS&I what to do

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tonycanoe
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NS&I what to do

#300288

Postby tonycanoe » April 13th, 2020, 10:36 am

I have a few days left in which I can cash in my NS&I Guaranteed Growth Bond. Six weeks ago - last comments on this board was on 23rd of February. A lot has changed in that time. I suppose nobody really knows but I'd like to ask fools to speculate on future of CPI and generally the future for these investments.
I follow some of the big economic hitters on twitter and it's either rampant inflation or deflation. It'll be nice to see what fools think.

mc2fool
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Re: NS&I what to do

#300303

Postby mc2fool » April 13th, 2020, 11:13 am

tonycanoe wrote:I have a few days left in which I can cash in my NS&I Guaranteed Growth Bond. Six weeks ago - last comments on this board was on 23rd of February. A lot has changed in that time. I suppose nobody really knows but I'd like to ask fools to speculate on future of CPI and generally the future for these investments.
I follow some of the big economic hitters on twitter and it's either rampant inflation or deflation. It'll be nice to see what fools think.

Are you confusing the NS&I Guaranteed Growth Bonds with the NS&I Index Linked Certificates? 'Cos it's the latter that is linked to CPI, not the former, and AFAICS the only topic on this board that has a last post on 23-Feb was on the latter. viewtopic.php?f=11&t=21825

tonycanoe
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Re: NS&I what to do

#300318

Postby tonycanoe » April 13th, 2020, 11:32 am

Sorry about confusion (doh!) I have both and was asking in general about inflation and deflation in relation to NS&I.

PinkDalek
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Re: NS&I what to do

#300322

Postby PinkDalek » April 13th, 2020, 11:38 am

tonycanoe wrote:I have a few days left in which I can cash in my NS&I Guaranteed Growth Bond. ...


We don't know how important that element of your overall wealth it is but, unless I've got the names mixed up, the (maximum) investment was £3,000. For the 3 year issue the rate was 2.20% and I recall some of us took it up at the time, to some derision. For me and for what it is worth, I'm letting it roll over at 1.70% for 3 years.

There are topics elsewhere re possible inflation/deflation*** but I'll leave that element to the economists.

*** Such as here at 'The Economy':

Is rising inflation looming?
viewtopic.php?f=62&t=22588

kiloran
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Re: NS&I what to do

#300373

Postby kiloran » April 13th, 2020, 1:12 pm

PinkDalek wrote:We don't know how important that element of your overall wealth it is but, unless I've got the names mixed up, the (maximum) investment was £3,000.

The Guaranteed Growth Bond certainly allowed £50k investment in Dec 2017, though the limit may have reduced in later years for new investments

--kiloran

AleisterCrowley
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Re: NS&I what to do

#300388

Postby AleisterCrowley » April 13th, 2020, 2:37 pm

The one I bought in Apr 2017 -'3 yr Guaranteed Growth Bond 2.2%' was limited to - and I'm pretty sure of this - £3,000

scotia
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Re: NS&I what to do

#300398

Postby scotia » April 13th, 2020, 3:23 pm

Some years ago (February 2015 in my records), in response to complaints from pensioners (who always vote) the government allowed these pensioners to purchase a 1 year and a 3 year NS&I 65+ Guaranteed Growth bond, each for a maximum of £10,000 at reasonably attractive rates (4% for the 3 year and 2.8% for the 1 year). At renewal these rates significantly decreased, and the "65+" label disappeared - i.e. I think they were opened to all over 16. My (renewed) 3-year bond which will mature in February 2021 currently pays 2.2%. I cashed in my 1 year bond in February 2020 - it paid 1.5% in its final year, but I think the next continuation rate was around 1%. And the limit on the amount of these Guaranteed Growth Bonds you could hold became substantial - certainly more than £100,000. But now it appears, from my reading, that these bonds are only available to customers renewing a maturing bond. And the renewed bond cannot be cashed in before its maturity date.
EDIT - I should have added that tying up the cash in the 1 year bond for a further full year at a negligible rate of interest did not appeal to me. And with an election a number of years away, its unlikely that the government will feel the need to offer the sweetener of a higher rate to pensioners.

PinkDalek
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Re: NS&I what to do

#300410

Postby PinkDalek » April 13th, 2020, 4:00 pm

Yes but it is the precise terminology that is all important. You mentioned 65+ etc. The full names for the various products over the years are at NS&I - can’t link from here with ease.

chas49
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Re: NS&I what to do

#300427

Postby chas49 » April 13th, 2020, 5:12 pm

It was the "Investment Guaranteed Growth Bond Issue 1" which was offered at 2.2% three years ago, and limited to £3000 per investor (so £6000 for a joint bond).

This is not the same product as the Guaranteed Growth Bond 3 Year - which had higher investment limits.

Neither of these are currently on sale - and only available to customers with maturing investments

In case it's of help, this is the 'summary box' for customers with bonds maturing before 30 April (rates from 1.25% for 1 year, up to 2% for a 5 yr bond - but dependign on the rate on the day you renew)

scotia
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Re: NS&I what to do

#300794

Postby scotia » April 15th, 2020, 9:47 am

The most recent change in these re-invested Guaranteed Growth Bonds appears to be the limitation that they must be held until the maturity date. Previous incarnations allowed withdrawal with some loss of interest as a penalty. So they no longer provide the liquidity of the earlier bonds. If liquidity of a cash savings is deemed important (even in unlikely circumstances), it looks like its back to the banks - at near zero interest, and a need to divide large sums over multiple bank licences to ensure each is covered by the compensation rules. So going back to the original query - whether or not to re-invest, I think this point about liquidity may require consideration.


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