WHERE SHOULD WE INVEST OUR SAVINGS?

Following advice from a building society, as an investment approaches fruition, most of which are over a short term, they recommended another short term investment, with a gross return of 3%, worded as if this is only just short of being bequeathed the Crown Jewels. If I did not make a move, they would just shunt the terminating investment into a siding to earn 0.05%; presumably the next option would be to have a hit team around to break legs. I did, however, decide to go for a four year untouchable account at 4.25%.

Such decisions, nevertheless, are difficult to make, when confronted with items in the press that suggest that interest rates could rocket to 8% within two years. This prediction is by the Policy Exchange think tank, in anticipation of accelerating inflation, which will force the Bank of England to make such a move. This figure should make the average saver salivate at the thought; unfortunately it would create total mayhem for mortgage holders, with disastrous consequences. Can this situation be avoided? We can only hope so, without the usual fudge which nudges it further down the track, compounding the problem.

So what does one do? Difficult, but on this occasion I went for the four year investment.


NEW LABOUR WILL HAUNT US FOR MANY YEARS TO COME.