Am I wasting my time with savings accounts?

Question

Which is the best possible way to get a good return on my money? I have a significant amount of savings stored away but the rate you get is absolutely pitiful. Someone once mentioned that investing is a good idea or even stocks and shares. I'd be VERY grateful if you could tell me all I need to know on this matter, as I'm not really sure of it.

Thank you so much,

Jason.

Answer 1

Stocks and Shares are okay if you don't mind losing as well as making! If you can afford the risk fine. If you don't want to risk then why not go for an ISA with your bank.

Answer 2

Certificates of Deposit. Consider the length and interest rates. Look at different institutions. There are penalties for early withdrawal.

Answer 3

Stocks and shares is a risk as they could go up and down.  You could invest some into premium bonds.  I know someone who invested £6000 and in one year she has won approximately £1000, you dont get interest, but you dont lose your money either.  You could save some into fixed term bonds, where you cant draw it out for 5 years and you get a higher rate of interest.  Click on to www.moneysavingexpert.com

Answer 4

Depending on the amount you're talking about, you could invest with tax-free savings. Mini-/maxi-cash ISAs give a better rate of return than savings accounts because interest isn't taxed.

Alternatively, you could lock the funds away for a short term and receive an even better rate with a high interest deposit bond or something similar (terms vary from about 3 to 10 years).

Or, if you're wanting to invest for a longer term, you could invest in shares - speak to your bank about what options are open to you. Buying shares now is quite lucrative as the 'credit crunch' has lowered the prices of many high-performers such as banks etc. But, many are predicting further drops, so don't be surprised to see prices go down further - you'd definitely need to be in it for the long haul.

For useful (accredited) advice, speak to a financial planning manager at your bank.

Answer 5

We have a guaranteed investement plan with HBOS which guarantees your capital but the return is based on stock market performance, in three years it has just lost what it made so I am not impressed with those. Now in my opinion is not a time to play the stock market. Premium bonds are OK but mine have made less that if the money had been put in the building society, however NSandI who do them also do some other products that may be of interest to you as they dont risk your capital. Have a look at their web site www.nsandi.co.uk

Answer 6

It all depends on the time period. Shares are good if you are looking long term. There are high, medium and low risk shares but its never safe so its good to invest in different shares. Its all about timing really and luck but if you get companies that pay good dividends then you can always just hold on to them if they go down. Shares have a tendency to over react to bad news so there are some bargains to be had. I buy and sell through abbey i think most banks do it but its not cheap so buying to few will make the whole price per share higher.

Answer 7

dunno.....we will see!!........lol!!

Answer 8

Invest it in a low cost, no load, equity income type mutual fund. Contact Vanguard.  Inially the dividend will only be about 3% but will keep rising every year and soon leave CD standing . Also you can expect about  8% capital appreciation over time.

Answer 9

Keeping money in a savings account, and investing, are two totally different things.

If the transmission breaks, and you have no money, you have an emergency.

If it breaks, but you have $5,000 in a savings account, you have an inconvenience instead of an emergency.

Savings accounts are your emergency fund.

They're not designed to grow, nor are they designed to be your retirement fund.

Investing in stocks is only for people who have more than enough money in their savings account that they can afford to buy a piece of a company, hold onto it for 5-10+ years, and try to make the money grow.

Answer 10

Bank interest is pitiful, but it is 100% safe. Playing with stock is like playing poker. You MIGHT win a good deal, but you might very well lose everything. So play if you want, but be sure not to put all of your money in the stockmarket.