Chief executive Jane Platt says: 'Since 2007 we have been working to simplify and modernise our range of savings and to encourage our customers to invest with us directly. At the same time, the Post Office has grown its own range of savings products. 'We're very proud of the service we deliver to savers by post, online and, in particular, via our UK call centres where staff have an average of over 24 years' experience and are available seven days a week, 365 days a year. 'We believe their expert knowledge of NS&I's savings and investments will help our customers transfer to dealing with NS&I directly and we will work with our colleagues at the Post Office to support our customers through the changes.'
A spokesman said just 16 per cent of the 2.3million Investment Account customers used the Post Office to make a transaction in the last year; around 146,000 Easy Access customers did.
When asked about the low rates, NS&I said that it's a necessary part of the 'balancing act' it undertakes every year. The state savings arm is only allowed to bring in a certain level of net deposits - £2billion this tax year - so as not to distort the savings market.
At Enable we know that looking after the pennies is what enables people to save up their pounds, it is difficult to know what to do with cash savings at the moment but looking to diversify and have a balance range of options before you is what Enable IFA’s of Bishop’s Stortford specialise in providing.
Monday, 12 December 2011
Leaving your cash in the Post Office no longer a safe bet…
Around 2.5million NS&I savers are getting paid less than 0.7 per cent on their savings, the government's savings arm admitted recently. The worst hit 2.3million sits in a National Savings & Investments 'Investment Account' that pays a maximum of just 0.3 per cent. That means that the government-backed body is paying great swathes of the population less than the Bank of England's base rate – supposedly a minimum standard – of 0.5 per cent.
The alarming figures emerged as NS&I pulled some of its services out of the Post Office, it will stop offering its Investment Account and Easy Access Savings Account, which has 260,000 savers, through Post Office branches. The move will leave just Premium Bonds and one other savings account on offer via Post Office branches.
Of it’s remaining accounts the Investment Account, first launched in 1966 and is getting a makeover and a 'higher rate' in May next year when it converts into a postal-only account with statements rather than a passbook. The Easy Access Savings Account, launched in 2004, recently closed to new savers on 28 November and in July 2012 it will shut down completely. NS&I has been encouraging customers to switch out of the account that pays a sliding scale 0.2 – 0.7 per cent and into its Direct Saver which pays 1.75 per cent.
IFA Enable specialise in helping savers find the best returns for their cash. Independent financial advice is always worth considering when trying to assess risk and best returns for your hard earned savings.
The alarming figures emerged as NS&I pulled some of its services out of the Post Office, it will stop offering its Investment Account and Easy Access Savings Account, which has 260,000 savers, through Post Office branches. The move will leave just Premium Bonds and one other savings account on offer via Post Office branches.
Of it’s remaining accounts the Investment Account, first launched in 1966 and is getting a makeover and a 'higher rate' in May next year when it converts into a postal-only account with statements rather than a passbook. The Easy Access Savings Account, launched in 2004, recently closed to new savers on 28 November and in July 2012 it will shut down completely. NS&I has been encouraging customers to switch out of the account that pays a sliding scale 0.2 – 0.7 per cent and into its Direct Saver which pays 1.75 per cent.
IFA Enable specialise in helping savers find the best returns for their cash. Independent financial advice is always worth considering when trying to assess risk and best returns for your hard earned savings.
Inflation UK - Keeping tabs on Inflation
Experienced Independent financial advisors at Enable know how worrying inflation is to so many savers. Just at the moment some savers are throwing money at inflation-linked bonds in a bid to protect their money but they could miss out on thousands of pounds over the next five years, analysts are warning.
Banks, building societies, and even the likes of Tesco are targeting Britons with tempting savings and investments that play on fears over escalating food and fuel prices, and its true soaring inflation hit its highest level in 20 years in September: 5.6 per cent on the official Retail Prices Index (RPI).. But a saver with £50,000 to deposit could end up more than £2,500 out of pocket if inflation drops.
Some current savings deals and retail corporate bonds promise to pay as much as 1 percentage point above RPI each year, providing at first glance a 6 per cent-plus return that protects the value of savers' cash. But it might be wise to think carefully about the official figures before tying your cash up.
The latest official count in October showed RPI inflation had dropped back to 5.4 per cent. All of the leading economic forecasters say it will continue to slacken during the coming half-decade.
The average of 21 independent predictions collected by the Treasury from major institutions like Citigroup and the ITEM Club suggest inflation will fall to 3.5 per cent next year, 2.9 per cent in 2013, before rising back to 3.3 per cent in 2014 and 3.4 per cent in 2015.
Banks, building societies, and even the likes of Tesco are targeting Britons with tempting savings and investments that play on fears over escalating food and fuel prices, and its true soaring inflation hit its highest level in 20 years in September: 5.6 per cent on the official Retail Prices Index (RPI).. But a saver with £50,000 to deposit could end up more than £2,500 out of pocket if inflation drops.
Some current savings deals and retail corporate bonds promise to pay as much as 1 percentage point above RPI each year, providing at first glance a 6 per cent-plus return that protects the value of savers' cash. But it might be wise to think carefully about the official figures before tying your cash up.
The latest official count in October showed RPI inflation had dropped back to 5.4 per cent. All of the leading economic forecasters say it will continue to slacken during the coming half-decade.
The average of 21 independent predictions collected by the Treasury from major institutions like Citigroup and the ITEM Club suggest inflation will fall to 3.5 per cent next year, 2.9 per cent in 2013, before rising back to 3.3 per cent in 2014 and 3.4 per cent in 2015.
Wednesday, 7 December 2011
Home Properties - Property is a vital cog in recovery
According to the latest RICS UK Commercial Market Survey, improvements in the commercial property market in the first half of the year faltered during Q3 2011 as occupier demand fell back for the first time in 12 months.
In would seem falling demand and rising availability has impacted on rental expectations, which weakened over the quarter, moving deeper into negative territory. The one area which continues to show a positive trend for future rents, albeit a flatter one than earlier in the year, is the central London office market. Simon Rubinsohn, RICS’ chief economist says: “While the London commercial market is still holding up relatively well, some of the positive momentum appears to have faded in the capital over the last few months - reflecting the wave of negative news flow surrounding both the prospects for the UK economy and the sovereign debt crisis in Europe.”
But property is still a vital cog in the whole of the economy. A new study from the Property Industry Alliance, the Property Data report, has found that the property industry contributes £46bn per year to the UK’s GDP. Robert Finch, chairman of the Property Industry Alliance, says: “The report shows the importance of the commercial property industry to the overall UK economy should not be underestimated and the crucial role it will play in our economic recovery. From providing places for people to work, shop and play through to playing a major role in funding retirement, the sector is a crucial cog in the UK economy. In legislating, the Government must be mindful of this.”
Enable of Bishop’s Stortford can offer independent financial advice on your property investments.
In would seem falling demand and rising availability has impacted on rental expectations, which weakened over the quarter, moving deeper into negative territory. The one area which continues to show a positive trend for future rents, albeit a flatter one than earlier in the year, is the central London office market. Simon Rubinsohn, RICS’ chief economist says: “While the London commercial market is still holding up relatively well, some of the positive momentum appears to have faded in the capital over the last few months - reflecting the wave of negative news flow surrounding both the prospects for the UK economy and the sovereign debt crisis in Europe.”
But property is still a vital cog in the whole of the economy. A new study from the Property Industry Alliance, the Property Data report, has found that the property industry contributes £46bn per year to the UK’s GDP. Robert Finch, chairman of the Property Industry Alliance, says: “The report shows the importance of the commercial property industry to the overall UK economy should not be underestimated and the crucial role it will play in our economic recovery. From providing places for people to work, shop and play through to playing a major role in funding retirement, the sector is a crucial cog in the UK economy. In legislating, the Government must be mindful of this.”
Enable of Bishop’s Stortford can offer independent financial advice on your property investments.
Prices of property - Commercial Property clearly linked to growth
Clearly commercial property does not operate in a vacuum. The fundamental factors in occupier demand for commercial property are tied directly to employment growth (or decline) and the level of consumer spending. Over the years experienced IFA’s like Enable of Bishop’s Stortford have also seen that there is a strong historic relationship between rental income growth and GDP growth.
In addition, commercial property tends to reflect local market conditions including available supply and the characteristics of individual buildings themselves, as demonstrated by the outperformance in 2011 by central London markets, both office and retail, in comparison to the wider UK. Investors need to be aware of these fundamentals and some say investors “cannot rely on a yield arbitrage play against emergency gilt yields as a means of achieving sustainable investment performance. The margin, or risk premium, at the present time should be seen as a buffer against a weak economic outlook which will be tested, severely, in the short to medium term.”
In the past experiences IFA’s like Enable have seen returns forinvestors in Commercial properties because rental income payments from tenants have, historically, been protected by long lease terms, upward review clauses and over-renting, where the contracted rents tenants are obliged to pay exceed the open market rental value at the time. During periods of economic weakness however, the market, logically, re-prices tenant default risk and growth prospects. This feeds into more volatile market rental values and capital values. Enable Independent Financial Advisors can help you review your portfolio.
Managing your money is a vital skill...
At all times spreading your assets and diversifying is good financial advice. Experienced IFA’s like Enable have seen the benefits of diversification over the years. Property has always been part of that diversification. Most portfolios contain property in some form even if it is just the house you live in but many also have money in Commercial Property.
But it is useful to note that the investment performance of UK commercial property over the longer term has been driven to a great extent by income return, reflecting rental payments received from tenants rather than capital appreciation. Over the 20 years to December 2010, commercial property delivered annualised total returns of 8 per cent per year, with the income return contributing 6.9 per cent per year.
In the nine months up to the end of September 2011, UK commercial property reported a total return of 6.4 per cent, comprising income return of 5.1 per cent and capital growth of 1.2 per cent suggesting, perhaps, that property had been delivering its ‘natural’ level of performance at the present time.
Property yields retain a considerable margin over dividend yields and an even more pronounced premium over 10 year gilt yields which have fallen as low as 2.5 per cent in recent weeks as concerns over the Eurozone sovereign debt crisis and whether the UK was heading towards a ‘double dip’ recession pushed investors towards extreme risk aversion.
The net income return delivered by property is however still proving attractive to investors for both investment performance and diversification benefits. Enable IFA’s of Bishops Stortford are happy to help you evaluate your diversification in these volatile times.
But it is useful to note that the investment performance of UK commercial property over the longer term has been driven to a great extent by income return, reflecting rental payments received from tenants rather than capital appreciation. Over the 20 years to December 2010, commercial property delivered annualised total returns of 8 per cent per year, with the income return contributing 6.9 per cent per year.
In the nine months up to the end of September 2011, UK commercial property reported a total return of 6.4 per cent, comprising income return of 5.1 per cent and capital growth of 1.2 per cent suggesting, perhaps, that property had been delivering its ‘natural’ level of performance at the present time.
Property yields retain a considerable margin over dividend yields and an even more pronounced premium over 10 year gilt yields which have fallen as low as 2.5 per cent in recent weeks as concerns over the Eurozone sovereign debt crisis and whether the UK was heading towards a ‘double dip’ recession pushed investors towards extreme risk aversion.
The net income return delivered by property is however still proving attractive to investors for both investment performance and diversification benefits. Enable IFA’s of Bishops Stortford are happy to help you evaluate your diversification in these volatile times.
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