How will the interest rate cut affect you?

Following on from the “Brexit” vote, last week’s interest rate cut to 0.25% isn’t a great surprise.  However, it is very disappointing news for savers, who for the last seven years have been hoping for an interest rate rise.

Unfortunately, low interest rates are likely to be with us for the foreseeable future.

If you are holding Cash ISAs, or have built up savings in bank or building society accounts, it may be a good idea to shop around to ensure you are being paid the most competitive rates of interest.  The most attractive rates are likely to be found in fixed term deposits, or regular, monthly savings accounts, but even these are now at the lowest rates they’ve been since comparable records began.

Alternatively, if you have built up cash reserves that are surplus to your anticipated needs and you are comfortable to invest these monies for at least five years, then you could consider investing them, to give you the opportunity for growth or income, as required.
There are a wide variety of investment options available, that can be matched to your personal circumstances and appetite for risk.  Please remember, however, that all investments carry an element of risk. Values can fall as well as rise and there are no guarantees that your investment will be worth as much as you put in at any one time.

We can explore the most suitable investments for you, whether you require a fixed level of income from a guaranteed product to preserve your capital values, or are looking for growth over the longer term.

If you would like to discuss the possibility of transferring your existing Cash ISA to a Stocks and Shares ISA to retain its tax efficient wrapper, or are considering investing new money into investments or pensions, please contact us and we will be happy to provide independent personal advice.

Posted on August 8th 2016

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