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Shaggy Sheep Driver
15th Jan 2015, 12:52
Any other old gits out there tried to buy these today? Half decent interest rates (at least on the 3-year bond) after years and years of the gov ripping off pensioners by taking interest they should be earning and handing it to those with mortgages. :rolleyes:

Only problem is - the website has rolled over and died under the deluge of applicants! So it'll be a postal application, then.

spekesoftly
15th Jan 2015, 13:26
Yes, and not surprisingly their phone number also constantly engaged.

Also noted that even though the interest is not payable until the end of the three years, higher rate tax payers will have to pay the additional tax annually - so in advance of receiving any interest!

Capetonian
15th Jan 2015, 13:59
They must be anticiapting good sales as they emailed me about it today, despite my having several years to go before I reach 65, perhaps they think the purchase process will take that long!

Tankertrashnav
15th Jan 2015, 14:50
Lucky you capetonian - I registered an interest with NS & I several weeks ago and assumed I'd get a heads up when they went on sale, but the first I knew was when I heard it on the Today programme this morning. Still no email as yet.

Same experience trying the website - it had crashed. I'll try again later because even with the tax snag mentioned above these are an attractive deal for anyone over 65 who is risk averse

ian16th
15th Jan 2015, 14:59
Anybody know if there are any residency restriction? Or are they available to UK State Pensioners world wide?

Capetonian
15th Jan 2015, 15:02
NS&I don't impose any restrictions, but you have to ensure that they are compliant with the laws and tax regime of your country of residence.

With few exceptions, that's not a problem.

Although not relevant in the context of these bonds, it is worth mentioning that wins on Premium Bonds, although tax free is UK, may not be tax free in if you are fiscally resident in another country.

Newforest2
15th Jan 2015, 16:54
My 25 squid a month win (!) doesn't affect my tax status, but my 'other' bank account, now that is a different story!

mixture
15th Jan 2015, 17:13
Shaggy Sheep Driver,

Tried to do my bit for the community and help an elderly person earlier....

Gave up after 1 hour of simultaneously trying on 3 different computers.

Also, the 1 hour of time gave time for contemplation, and it was decided that £400 interest on £10,000 wasn't worth the hassle, since the £400 is taxable .... so you're pretty much left with bugger all.

Capetonian
15th Jan 2015, 19:40
Video: NS&I pensioner bonds: one minute guide - Telegraph (http://www.telegraph.co.uk/finance/personalfinance/investing/11348410/NSandI-pensioner-bonds-one-minute-guide.html)

Choxolate
15th Jan 2015, 20:08
Just to be a smug arse, I applied on-line this morning at about 11:00 am and although the web application was slow, it took me a total of about 20 minutes to log in (already registered with NS&I) enter relevant details for debit card and get confirmation email that my application has been received for £10k for the 3 year bond.

OK 4% isn't fantastic (3.2% after basic rate tax), but it'll keep ahead of inflation.
Another excellent deal is the Santander 1-2-3 account - I get 3% interest on a current account and keep it topped up to the maximum (£20k) - the beauty is that 3% isn't too bad and the cash is instantly available if needed - beats all instgant access savings accounts.

Shaggy Sheep Driver
15th Jan 2015, 20:11
Yeah but... Santander innit. :eek:

Whirlybird
15th Jan 2015, 21:25
So the website crashed with the number of over 65s applying on-line did it? I thought received wisdom said that oldies can't manage to use computers. :confused::confused:

Seldomfitforpurpose
15th Jan 2015, 22:42
Another excellent deal is the Santander 1-2-3 account - I get 3% interest on a current account and keep it topped up to the maximum (£20k) - the beauty is that 3% isn't too bad and the cash is instantly available if needed - beats all instgant access savings accounts.


Mrs SFFP, retired early like me, has 20k in the Santander account so gets her 3% tax free. We had a tidy sum more than that to invest but trying to find anything even close to that risk free has proved impossible to date.

racedo
15th Jan 2015, 23:32
Lend money to Govt and they know you have it.

Loose rivets
15th Jan 2015, 23:59
" . . . so the maximum across these bonds is 20 thousand."


Fot the wuck does that mean?

Seldomfitforpurpose
16th Jan 2015, 00:16
Lend money to Govt and they know you have it.


They knew you had it in the first place so why is it a problem?

Krystal n chips
16th Jan 2015, 06:13
Basil,

"missed that bit;taking the piss, what ? "

Congratulations old boy !.....for winning the " Best understatement of the year award "....;)

Whilst Generous George has negated, at least for the moment, the parasitic, profiteering, self centric providers of annuities.....you can bet the same social vermin have been hard at what they feel constitutes "work " in order to recoup the money they may lose through the changes and will duly be marketing these products to con the gullible in the near future.....as will others who are unregulated.

HM Gov't won't do too badly as a result......strangely enough.

That said, and because one is a lower class peasant, officially classified as thick by the luminaries on here.....even if one were eligible, one would avoid these like the plague.

There are plenty of other options, all low risk, out there......

Pensioner bonds at 4% expected to cause savings stampede in January sale | Money | The Guardian (http://www.theguardian.com/money/2014/dec/12/pensioner-bonds-savings-stampede-january)

Seldomfitforpurpose
16th Jan 2015, 08:25
There are plenty of other options, all low risk, out there......



Any chance you could share that info with us as you clearly know something the Guardian writer that you quote doesn't

The rates are much better than anything that can be got from a standard fixed-rate savings bond today. This week, the highest rate on a three-year bond was 2.5%, while the top rate on a one-year bond was 1.9%. :p:p:p

Choxolate
16th Jan 2015, 09:29
Mrs SFFP, retired early like me, has 20k in the Santander account so gets her 3% tax free. We had a tidy sum more than that to invest but trying to find anything even close to that risk free has proved impossible to date.
How come Tax Free?- tax is deducted by Santander at source with me, is the good Mrs SFFP's total income below the tax threshold?

BabyBear
16th Jan 2015, 09:44
Mrs SFFP, retired early like me, has 20k in the Santander account so gets her 3% tax free. We had a tidy sum more than that to invest but trying to find anything even close to that risk free has proved impossible to date.

Open another 123, simples!

radeng
16th Jan 2015, 14:24
If you have been with Nationwide 15 years, you can get 2.5% on an instant access account with a max of £50k. Coventry Building Society has a similar scheme for cash ISAs with instant access and 2.5% tax free.

The problem with the higher interest rates can be the higher tax rate....

BabyBear
16th Jan 2015, 14:32
If you have been with Nationwide 15 years, you can get 2.5% on an instant access account with a max of £50k

Can you point me to that one radeng? You sure you are up to date with rates?

The problem with the higher interest rates can be the higher tax rate....

Why is that a problem?

Edited to say I just checked NW. I think you may find you are getting 1.5%?

Seldomfitforpurpose
16th Jan 2015, 14:57
How come Tax Free?- tax is deducted by Santander at source with me, is the good Mrs SFFP's total income below the tax threshold?


Exactly, I left the RAF at age 55, she took voluntary redundancy at age 53 and we now travel and live quite comfortably on my pension :ok:

Seldomfitforpurpose
16th Jan 2015, 15:05
Open another 123, simples!


And pay rather a lot of tax on the interest I earn?


I just let Mrs SFFP manage the pot, to date we have a couple of long running ISA's, the 123 acct, a couple of Nationwide accounts, a Lloyds acct that I know of. All in her name and not earning enough to trigger her tax threshold and that's about the best we can do.

Seldomfitforpurpose
16th Jan 2015, 15:07
There are plenty of other options, all low risk, out there......

Pensioner bonds at 4% expected to cause savings stampede in January sale | Money | The Guardian (http://www.theguardian.com/money/2014/dec/12/pensioner-bonds-savings-stampede-january)


Come on fella, spill the beans with regards to these other options :p

BabyBear
16th Jan 2015, 15:18
And pay rather a lot of tax on the interest I earn?

No, have Mrs SFFP open another.:ok:

Capetonian
16th Jan 2015, 15:24
Those of you who have a bit of spare cash to invest may consider Premium Bonds. I have found mine over the years returning roughly 1.25%, which is as good or better than most bank or building society accounts, specially considering that the money is not tied up and they are instantly redeemable. The initial capital is not at risk, although there is a risk of no winning which means in real terms a loss.

As long as mine maintain that sort of return, and there is always the possibility of a big win, I'm happy with them.

Draft Dodger
16th Jan 2015, 17:29
Tried online to put £10,000 in the 1 year and the same in the 3 year but it will not let me put more than £10,000 in both. I thought that you could have £10,000 in each bond as an individual.

mixture
16th Jan 2015, 17:43
Come on fella, spill the beans with regards to these other options

I suspect Krystal n chips is referring to the markets.

Trouble is most people don't know their bonds from their prefs, let alone be trusted on their own to pick the correct stuff to invest in and are unwilling or unable to spend the time seeking out good financial advice.

There are collectives, of course, whose aim is to hide the complexity and spread the risk. But on the whole, with a few exceptions collectives are a mugs game.

So that's why most people end up in the low yielding bank accounts and NS&I products.

Not that boring stuff is a bad thing in old age .... but if you are old, with money to spare after you've stashed away a healthy chunk of it in boring stuff, then the markets and not pensioner bonds is where you'll see a greater return for your spare £10k, even more so within the confines of an ISA !

Seldomfitforpurpose
16th Jan 2015, 19:57
I suspect Krystal n chips is referring to the markets.



If you read what he said then I doubt very much you are correct as the markets are certainly not a safe option :ok:

mixture
16th Jan 2015, 20:07
as the markets are certainly not a safe option

Please re-read the majority of my post. :ugh:

I did say ... spare cash.
I did say ... not for your average punter who has no knowledge and no advice

Sure the markets are not 100% "safe", but what is these days ? Apart from NS&I perhaps, but then you pay for that with poor returns.

Its certainly possible to run a low-risk portfolio that provides you with supplementary income ... which is typically what the oldies need to supplement their meagre pensions.

But, as I said, only if you know what you're doing and/or you have decent independent advice..... and certainly ONLY if you have sufficient spare cash.

And its certainly not like the NS&I where you can set and forget .... if you're not willing to monitor and manage (or have someone else do it for you) then you have no place in the markets.

Risk vs reward my friend. Even old farts (in the right circumstances) can still take some risk.

Seldomfitforpurpose
16th Jan 2015, 20:09
Do the markets ever crash?

mixture
16th Jan 2015, 22:07
Do the markets ever crash?

First, there's a difference between a "crash" and a market corrections.

Market corrections are on the whole not much for the long-term investor to worry about. The media like to make mountains out of molehills any time a market undergoes a minor correction.

True market "crashes" such as 2008 are about as rare as banks going bust, and even then, good shares will recover..... look at the FTSE100 chart ...pre-2008 peak in August 2008, back up there by January 2010 ! :ugh:

And for heavens sake, I did say right from the outset.... if you are old, with money to spare after you've stashed away a healthy chunk of it in boring stuff, then the markets are worth considering over lousy pensioner bonds, especially if you're not even using your annual ISA allowance.

I said right from the start, for the old farts, cash and boring first before you take any risks.

I also said from the outset, if you don't have the know-how to manage a portfolio or make the effort to find a decent advisor.... you should not be in the markets.

If you want to be a 100% risk-averse OAP, then fine.... but I'm just saying you don't have to be, and that the markets don't automatically mean you are being reckless.

radeng
16th Jan 2015, 22:13
BB,

you have to been with them (or one of the ones they took over) long enough to be eligible for a 'Loyalty Account'. But I don't know if they are still offering it as an option.

Seldomfitforpurpose
16th Jan 2015, 22:39
First, there's a difference between a "crash" and a market corrections.

Market corrections are on the whole not much for the long-term investor to worry about. The media like to make mountains out of molehills any time a market undergoes a minor correction.

True market "crashes" such as 2008 are about as rare as banks going bust, and even then, good shares will recover..... look at the FTSE100 chart ...pre-2008 peak in August 2008, back up there by January 2010 ! :ugh:

And for heavens sake, I did say right from the outset.... if you are old, with money to spare after you've stashed away a healthy chunk of it in boring stuff, then the markets are worth considering over lousy pensioner bonds, especially if you're not even using your annual ISA allowance.

I said right from the start, for the old farts, cash and boring first before you take any risks.

I also said from the outset, if you don't have the know-how to manage a portfolio or make the effort to find a decent advisor.... you should not be in the markets.

If you want to be a 100% risk-averse OAP, then fine.... but I'm just saying you don't have to be, and that the markets don't automatically mean you are being reckless.

So in essence markets can crash and playing the market is risky, even for those who think they know what they are doing.

So why do you think that 'oldies who need to supplement their meagre pensions' , your words chap, are going to be in a position to gamble their meagre savings away?

Hence my asking KnC to give us the links to the just as safe and just as good savings plans as he previously suggested in this thread.

Whiskey Kilo Wanderer
16th Jan 2015, 23:01
I've been playing with these for a couple of years and am getting around 5% (after fees and defaults but before Tax). They are not that popular due to the perceived risk. Not for everyone , although I have heard or someone funding their retirement from one. Rumour has it that they may be incorporated in an ISA wrapper in the near future.

mixture
17th Jan 2015, 00:50
So in essence markets can crash and playing the market is risky, even for those who think they know what they are doing.

Have you even read my posts ? :ugh::ugh:

As I keep on saying "spare cash"... if you don't have that, if your final pension pot is in the low six figures (or worse !) then you should not contemplate the markets in your old age. Simples !

The markets are not playing or gambling, they can be, but they don't need to be. A well balanced, well managed, correctly diversified, low-risk portfolio can yield an average 4% income at the moment (obviously some sectors will yield more than 4% some less, 4% is the mathematical average across the portfolio) PLUS a little capital growth on top of that... so you would be somewhat foolish to completely write off the markets if you're sitting on a larger pension pot.

Believe what you like, I can't be bothered to repeat myself again for your benefit other than to repeat the final phrase of my last post:
If you want to be a 100% risk-averse OAP, then fine.... but I'm just saying you don't have to be, and that the markets don't automatically mean you are being reckless.

Shaggy Sheep Driver
17th Jan 2015, 00:57
I take it K&C promised information about risk-free investments that better the 4% for 3 years of the NS&I offer, but he hasn't delivered? Well quelle surprise!

(He comprises my ignore list so I don't have it first hand).

mixture
17th Jan 2015, 01:11
They are not that popular due to the perceived risk.

"Perceived" risk ? :D

If Seldomfitforpurpose wants to talk about real risk, then that's the place to look, Peer to Peer lending !

Far riskier (by a million miles) than the markets !

Krystal n chips
17th Jan 2015, 07:30
SFFP,

The delay in responding...two reasons, one, despite the kind suggestion of a poster with 2662 posts, in contrast to say 729, to " get a life " the post count may suggest otherwise, that, and the operational glitch as mentioned in the Computer forum.

However, the answer is contained within the article and within the comment below.....

" Trouble is most people don't know their bonds from their prefs, let alone be trusted on their own to pick the correct stuff to invest in


True, and I am no exception...even more so when classified as I am....

and are unwilling or unable to spend the time seeking out good financial advice


True again to begin with.....except that, working on the life long principle of asking advice about any subject I know little about, or to expand on knowledge I already have, I did precisely that. And since I don't intend to join those on here whose modesty ensures they tell the world their entire financial status....then you will be disappointed hereafter.

What I will say is that the returns are based on longer term plans.

I take it K&C promised information about risk-free investments that better the 4% for 3 years of the NS&I offer, but he hasn't delivered? Well quelle surprise!

(He comprises my ignore list so I don't have it first hand

Alas, that well know adage "never check, always assume" doth spring to mind here.....

Seldomfitforpurpose
17th Jan 2015, 08:52
SFFP,

The delay in responding...two reasons, one, despite the kind suggestion of a poster with 2662 posts, in contrast to say 729, to " get a life " the post count may suggest otherwise, that, and the operational glitch as mentioned in the Computer forum.

However, the answer is contained within the article and within the comment below.....

" Trouble is most people don't know their bonds from their prefs, let alone be trusted on their own to pick the correct stuff to invest in


True, and I am no exception...even more so when classified as I am....

and are unwilling or unable to spend the time seeking out good financial advice


True again to begin with.....except that, working on the life long principle of asking advice about any subject I know little about, or to expand on knowledge I already have, I did precisely that. And since I don't intend to join those on here whose modesty ensures they tell the world their entire financial status....then you will be disappointed hereafter.

What I will say is that the returns are based on longer term plans.

I take it K&C promised information about risk-free investments that better the 4% for 3 years of the NS&I offer, but he hasn't delivered? Well quelle surprise!

(He comprises my ignore list so I don't have it first hand

Alas, that well know adage "never check, always assume" doth spring to mind here.....

So in answer to my request for information on the risk free investments that are a better deal than the 4% offered by the latest N&SI deal your answer is to offer nowt but bluff and bluster, as Shaggy Sheep Driver remarked quelle surprise!

BabyBear
17th Jan 2015, 09:36
you have to been with them (or one of the ones they took over) long enough to be eligible for a 'Loyalty Account'. But I don't know if they are still offering it as an option.

I'm aware of the accounts. The initial issue retains the highest return at 1.7% gross without the £50K limit. Subsequent issues with the £50K limit have a max of 1.5% gross. I assume you have a later issue due to your £50K limit?

I suggest the rate has been reduced from an initial 2.5% since you opened your account.

It's better you know than not, sorry.

Loki
17th Jan 2015, 09:47
Mixture ....yes, peer to peer is risky, but a lot of that can be mitigated with some care. A couple of businesses I've lent to have gone t*ts up, but I'm still managing 6% or more before tax. Talk of it all being ISA eligible soon too.

My experience with funds (in an ISA wrapper) have been OK, one I have put money in ...£10k 4 years ago, gives me £45 per month and is now worth £14k.

My no risk element of my savings comprises some cash ISA (rubbish return at the moment) and premium bonds.

I'll consider these pensioner bonds, but the tax aspect bothers me, as I'll be a 40% er ere long.

racedo
17th Jan 2015, 10:25
They knew you had it in the first place so why is it a problem?

Maybe, Maybe not.

Call me cynical but I don't trust Govt.

BabyBear
17th Jan 2015, 10:34
Assuming you're 65+ and have spare cash that cynicism could be expensive. Needlessly.:rolleyes:

Keef
17th Jan 2015, 11:09
The NS&I offer certainly triggered activity among those who are supposed not to be able to work a computer! I gave up on the website application (timed out many times over a couple of hours), printed off the form and posted it.

That cute Mr Branson's lot spotted the net income for a higher-rate taxpayer of the 3-year deal and set a cash ISA at a whisker better. I still prefer NS&I.

Krystal n chips
17th Jan 2015, 11:48
" So in answer to my request for information on the risk free investments that are a better deal than the 4% offered by the latest N&SI deal your answer is to offer nowt but bluff and bluster, as Shaggy Sheep Driver remarked quelle surprise!

I can understand the meeting of minds here, and indeed the empathy, but, alas, I never said anything about risk free investments......now did I.

What I did say, was, there are plenty of other options, all low risk, out there.

That, and as I freely admit ( lacking the self proclaimed expertise of many on here ) I know relatively little, like most people in fact, of the complexity of investing...hence the reason, which seems to have eluded you, that I spoke to people wot duz.

Seldomfitforpurpose
17th Jan 2015, 12:41
So still no examples then, quelle surprise it is :p:p:p

Effluent Man
17th Jan 2015, 12:58
Another little bribe to try to scupper Nige.

racedo
17th Jan 2015, 14:07
Assuming you're 65+ and have spare cash that cynicism could be expensive. Needlessly.:rolleyes:

By time I get to 65 I fully intend to make sure I rely on Govts for little.

Having homes in variety of countrys will mean I go where I like most at whatever time of year.

funfly
17th Jan 2015, 17:41
It is correct that tax will have to be paid annually although the interest will not be paid until the end of the third year.

In my opinion if you only have just over £20,000 you wouldn't want it tied up for three years, on the other hand if you have capital on which you have to live then £20.000 is not worth the effort.

If you have money in Santander 123 you get 3%, if you put this into a 4% bond this will give you an additional £200 a year less tax. To be honest this is only a couple of Tesco shopping bills.

What is needed for pensioners is a fund at around %4 where your complete capital can go - then it's worthwhile.

We are the ones who have saved all our lives and collected enough to live without a cost to the state. Surely we can expect some support.

spekesoftly
17th Jan 2015, 17:43
Basil,

Please see quote below from:-

Revealed: the tax sting on the Government's 'pensioner bonds' - Telegraph (http://www.telegraph.co.uk/finance/personalfinance/savings/11288999/Revealed-the-tax-sting-on-the-Governments-pensioner-bonds.html)


"As a result, a higher-rate taxpayer subscribing to a three-year bond will be expected to declare on self-assessment tax returns the interest "earned", but not received, each year. HM Revenue & Customs told The Telegraph that customers will have to pay the full 40 per cent levy on that money during the first and second years of the bond's term - even though the saver would have received no interest".

Choxolate
17th Jan 2015, 19:33
funfly:
In my opinion if you only have just over £20,000 you wouldn't want it tied up for three years, on the other hand if you have capital on which you have to live then £20.000 is not worth the effort.
That's a little bit "binary" I have recently retired and have quite a reasonable "cash pot" of which about 60% is in a SIPP which I manage myself. The balance I have in a variety of investments from Property, Stocks & Shares ISAs, Santander 1-2-3 Account, Peer-to-Peer lending, Seedrs startups and now the Pensioner Bond.

Spreading your investments over a range of low risk low return through to high risk high return is the best approach. How much you have in each category depends on how much you have in total and how much you can afford to lose.

So far I have not had to touch the SIPP and do not plan to do so for at least another 4-5 years, in the meantime living off the returns from the other investments plus the state pension and also nibbling into some capital.

Diversity is the key IMHO.

Gertrude the Wombat
17th Jan 2015, 21:36
What is needed for pensioners is a fund at around %4 where your complete capital can go
You can get that from residential property (with the capital risk of a housing price crash). If you don't what the hassle of running it yourself there ought to be funds somewhere ... although of course they'll take a cut.

You'l have to put up with political opprobium as the evil capitalist cause of "generation rent", but plenty are prepared to live with that.

Capetonian
17th Jan 2015, 22:50
You'l have to put up with political opprobium as the evil capitalist cause of "generation rent", but plenty are prepared to live with that. I'm one of those that's happy to live with being called an 'evil capitalist' and all the other insults that buy-to-let landlords have to put up with.

I'd be a lot happier if I were getting a 4% return on my investment in property.

mixture
18th Jan 2015, 09:10
You can get that from residential property (with the capital risk of a housing price crash)

Two words for you ... illiquid asset.

You can't really consider property as a serious form of investment in your old age unless you've got a lot of money already elsewhere, in which case property might well be seen as diversification of your existing portfolio.

Problem is, your average punter doesn't have that much money elsewhere, in which case they're literally betting the house on investing in property !

Gertrude the Wombat
18th Jan 2015, 11:59
Yup.

Should have mentioned the other risk, although of course it's blindingly obvious, which is that a future Labour government might decide to screw over private landlords.

racedo
18th Jan 2015, 12:07
Should have mentioned the other risk, although of course it's blindingly obvious, which is that a future Labour government might decide to screw over private landlords.

They might but then their councils are trying that anyway.

Problem Labour would have is that landlords are not all Tory voting rich people.

Just as likely to be the Middle Labour voter who invested in a couple of propertys to make up pension.

Gertrude the Wombat
18th Jan 2015, 15:02
Just as likely to be the Middle Labour voter who invested in a couple of propertys to make up pension.
I know that, you know that, but I have certainly come across some Labour politicians who appear not to.

They'd probably still not approve even if they did know, mind. I'm talking about the socialist one-size-fits-all levelling-down wing of the Labour party, currently in the ascendant, who think that everybody should live in a council house (because it's "not fair" otherwise) and that everybody should live on the state pension (because it's "not fair" otherwise).

Mechta
18th Jan 2015, 19:06
Mechta Senior tried to get an NS&I bonds. This was his experience (amongst other computer-related blood pressure raisers the same day):

Probably the most frustrating of all was our attempt to apply for a pair of the new 65+ NSI Bonds. We are not there yet but hope to get a successful application accepted before NSI's limited funds run out.

The genius who designed the NSI website has not missed a trick. What can you do when, asked for your National Insurance number if it will not let you put the correct double digit numbers in the relevant 'boxes'?
It also demands that, as security checks, one provides answers to each of five mandatory questions, two of which were:-
1, "Name of the hospital where your eldest child was born?" So presumably childless applicants and home births are disqualified.

and

2. "Your favourite TV programme when you were a young child." to which I replied that there was no television when I was a young child (Mechta Senior is 87). As only 'over 65s' qualify, I suspect I am not unique.

To avoid all the 'on-line' hassle we shall probably use the more straightforward postal applications instead.

spekesoftly
19th Jan 2015, 01:06
What can you do when, asked for your National Insurance number if it will not let you put the correct double digit numbers in the relevant 'boxes'?Frustrating, but it's not a mandatory question so just leave it blank. (I've just tried a dummy application as far as that page, and had no problem entering some random double digit numbers).

It also demands that, as security checks, one provides answers to each of five mandatory questions ................... Just put in whatever answer you like, it doesn't have to be factual, but of course you need to remember your answers. Use the print function (top of the page) and keep a hard copy.

Allan Lupton
19th Jan 2015, 09:54
It does not ask for your National Insurance Number, but does ask for your NS&I number which is what you get if you register with NS&I (National Savings and Investments) for telephone/online access.

spekesoftly
19th Jan 2015, 10:41
The online application does ask for your National Insurance Number if you are not already registered with NS&I. However, it's not starred as a mandatory field, and the alternative paper application does not ask for your National Insurance Number.

Capot
19th Jan 2015, 13:37
Just as likely to be the Middle Labour voter who invested in a couple of propertys to make up pension.That must have been a Mr A. Blair, I guess; he followed that path. His spelling was wonky, too.

david parry
6th Feb 2015, 08:15
The Government's rules for pensioner bonds means that savers must tie up their money for either one or three years.
The penalty for withdrawing money early is the loss of three months of interest.
However, even with the penalty set at this level, those savers in the three-year bond who want to get at their money after a year can do so relatively cost effectively.
The extra interest they earn from the longer-dated account will outweigh the penalty for leaving early.
The 4 per cent rate they get from the three-year bond falls to 3 per cent if they forgo three months interest by withdrawing early - but this still beats the 2.8 per cent rate for the one-year bond.
This stands in contrast to many fixed rate savings accounts that do not allow people to withdraw ;)

Shaggy Sheep Driver
8th Feb 2015, 18:12
The gov's extension of the 4% pensioner bond offer has been described as 'inter-generational theft'. What tosh!

Many pensioners have saved all their lives for retirement, and for many years now have been robbed of investment income, typically around 6 or 7%, by deliberate gov policy of ludicrously low interest rates (often less than 1%). This effectively robs these pensioners of their planned investment income, and hands it to borrowers in the form of cheap mortgages. THAT's inter-generational theft!

And when they were young, these now-pensioners (like what I am) were paying mortgage rates of around 15%!

I'm lucky in that I don't rely on investment income (so this is no self-interested squeal), but I know plenty who do - they have seen their incomes plummet in recent years and are struggling as a result. A £10k bond at 4% isn't going to go far to redress that!

G-CPTN
8th Feb 2015, 18:26
As I understand it, these bonds are subject to income tax, which will be deducted before the bond matures (in addition to a deduction of interest for early retrieval).
What might be a typical net interest rate?

Capot
8th Feb 2015, 18:35
The way I see these Pensioner bonds is that it is the Government borrowing pensioners' pension funds (which it has just released) to use to fulfil otherwise unaffordable expenditure being made to please the electorate.

To encourage the pensioners to lend their savings to the Government quickly so that they can spend it on winning the election, they are offering a higher rate of interest than most pensioners can get elsewhere, with the same low risk.

The interest payments will be funded from the receipts from selling the Bonds, so no problem there. It's quite similar to a Ponzi scheme.

Being politicians with an extremely limited horizon, the fact that the principal must be repaid in 3 years time in full, and that the funds needed to make up the shortfall resulting from the excessive interest payments will have to come from somewhere else is a problem they are entirely happy to put off until it hits them in the face. The income tax receipts won't be sufficient to do that, although they will help. Quantified, the shortfall will be about 7% - 9% of the money due to be repaid, but I'm sure that a cut can be made somewhere to pay for it in 2018. It is very unlikely that a forward provision will be made by making cuts elsewhere from now to put into the provision; just before a election that would be bad news.

Whether this is a problem for the Tories, Labour, UKIP, the Greens or the SNP, when the time comes, remains to be seen.

By the way, did anyone see it clearly explained that if a Government pays you £400 in interest on the £10,000 you have lent to it, and takes 20% - 40% (£80 - £160) of it back in Tax, what you are left with is the effective interest, say 2.4% - 3.2%, which is a long way from 4%, for a 3-year loan? No, thought not.

Shaggy Sheep Driver
8th Feb 2015, 19:03
Um, Capot.. the gov takes 20% to 40% of the interest any investment. Even if you only have a 'return' of 1% on the capital to start with. Of course we know that!

And don't get me started on ISAs! Tax free for sure, but the rates set so low by the banks that it's the banks who trouser the returns, not the savers! A direct subsidy to the banks from gov! Now where have we heard of that before?

G-CPTN
8th Feb 2015, 19:49
you may only have to pay 10% on your interest, instead of the usual 20%.
You’ll have to claim a refund from HM Revenue and Customs (HMRC) as tax will have been deducted at 20% by your bank or building society.
From:- https://www.gov.uk/apply-tax-free-interest-on-savings/10-savings-rate

vulcanised
8th Feb 2015, 20:47
Meanwhile............

If you are in receipt of Pension Credit and your vast wealth creeps over £10k (a figure which has remained for years taking no account of inflation, QE or owt else) they will deduct £1 per week for every £500 or part that your fortune exceeds £10k.

I leave the interest rate calculation to you.

mixture
8th Feb 2015, 22:49
Inter-generational theft

Isn't that Patek Philipe's advertising is based on ? ... "sorry chum, just blew what's left of the inheritance on this rather expensive watch" :E

For those who have not seen the advert : "You never own a Patek Philipe. You merely look after it for the next generation"

MG23
9th Feb 2015, 00:37
And when they were young, these now-pensioners (like what I am) were paying mortgage rates of around 15%!

Which meant:

1. House prices were low, because people couldn't afford to take out a bloated mortgage.
2. Interest rates were high because inflation was high, with rapid pay rises that wiped out the value of the debt.
3. Interest rates were far more likely to decrease than increase.

But few people understand compounding over decades, which is why they think low interest rates are good for them.

Wingswinger
9th Feb 2015, 08:39
1. House prices were low, because people couldn't afford to take out a bloated mortgage.

House prices were low because the mortgage market was highly regulated. One had to have a healthy deposit, a track record of regular monthly saving with the lender, mostly mutual building societies, and then wait in a queue for months for a mortgage to be granted. The banks hadn't muscled in on the mortgage market so the market hadn't been pumped up with £billions of debt. That's why houses were cheaper relative to incomes.

Shaggy Sheep Driver
9th Feb 2015, 09:00
You also had to demonstrate that you had the income to comfortably pay the monthly repayments.

Wingswinger
9th Feb 2015, 10:11
Yes, of course. When we applied for our first mortgage on a small bungalow in '78 we had 35% deposit and we had been putting away £50 a month for over 3 years. The price was 2.8 times our annual income at the time and we still had to wait four months for the mortgage offer from the Abbey National Building Society. I can't help but think that the world would be a happier place for the younger generations if it were still like that, before the days when the bankers got greedy and muscled in on everyone else's business.

MG23
9th Feb 2015, 16:59
House prices were low because the mortgage market was highly regulated.

If you're earning 20k a year, you can take out a 2% interest-only mortgage on a 300k house. If interest rates are 15%, the same amount of interest will only buy a 40k house. That means the price of houses has to fall until people can afford them.

Doesn't matter whether banks are handing out mortgages to anything with a pulse, if no-one can afford to pay the annual interest.

Capot
9th Feb 2015, 18:28
That means the price of houses has to fall until people can afford them.Impeccable reasoning, but I recall that in the period 1980 - 1984 our house in Essex went from the £55,000 we paid to the £80,000 we sold it for, at a time when mortgage rates were coming down, very very slowly, from around 15% to around 12%.

http://i243.photobucket.com/albums/ff141/picshooter/Screen%20Shot%2002-09-15%20at%2006.24%20PM_zps0nq2gsai.png

MG23
9th Feb 2015, 18:41
Impeccable reasoning, but I recall that in the period 1980 - 1984 our house in Essex went from the £55,000 we paid to the £80,000 we sold it for, at a time when mortgage rates were coming down, very very slowly, from around 15% to around 12%.

Uh, yes. Interest rates were going down, so people could afford to borrow more, and wages were going up, so people could afford to borrow more.

G-CPTN
9th Feb 2015, 19:33
In 1970 we attempted to buy ourselves a house to get married.

We were dismayed to discover that 200 year-old thatched cottages were not in favour by those offering mortgages - and we had no capital, so we had to settle for a new-build (on which they were offering 100% mortgages).
So, in effect, we bought a mortgage.

The new-build was priced at £5000, and I had no problems satisfying the income requirement (something like 2.5 times income IIRC).

The site sales agent suggested that we should buy two houses, and he would guarantee the price for a £50 deposit.

Why on earth would we want two houses (or, more precisely, two mortgages)?
The offer was for the second house to be built some 18 months to two years later on another part of the soon to be large housing estate - but this would mean moving and fixing up a new garden etc etc.
Anyway, I didn't have £50 to spare (although, in retrospect, I could have borrowed it).

By the time our house was built, the new ones were selling for £7,500 - so we could have made £2,500 profit from selling our option (or, maybe a little less to undercut the builder), twelve months afterwards, the price was £10,500 and, six months later, £12,500, so we could have moved into a completely mortgage-free house (but would we?).

Just saying . . .