Posted on May 12, 2010.
National Savings: what everyone should know about the national savings Many people saw their investments during the recession. If you are looking for a safer place for your money UK savings institution National Savings and Investments (NS & I) has a range of products offering different types of savings options, all guaranteed by the government.
What makes the different national savings?
On the positive side, a number of products of national savings are totally tax free, and the capital invested in its products is 100% secure because it is supported by the Treasury. While banks had always seemed to be a safe investment, the credit crisis has shown that this is not always the case.
The main negative that you must consider when you invest in national savings accounts is that they tend to offer lower fares competitive interest. However, if one compares interest rates with options outside of national savings, remember to take into account the tax you would pay for these options, and calculate whether you are really better performance.
What products are tax free?
If you invest in National Savings products, which are tax free, you will not have to pay tax on interest or the price you receive. duty-free products are Premium Bonds, ISAs, bonds children of bonuses and savings certificates.
taxable products include savings accounts, income bonds, capital guaranteed bonds, bonds guaranteed growth bonds and guaranteed income. If you invest in one of these, you will pay interest and claim on your tax return.
How long do I invest?
The product range of national savings are "easy access products, allowing you to withdraw money whenever you want, and plans more term when you invest in one to five years.
How can I win 'prizes'?
Premium Bonds are a unique type of product, available exclusively through domestic savings. You can invest from £ 100 to £ 30,000 in premium bonds. You will receive no interest on your capital, but each £ 1 bond has an equal chance of winning a cash prize in monthly draw.
Prices range from £ 25 to a jackpot of 1 million pounds. Unlike the National Lottery, the initial capital you have invested will remain strong, although over time it will be eroded by inflation.
How do I know if national saving is right for me?
NS & I is often considered a "safe and stable way to invest money. If you're worried about your money (and the recent events that you have the right to be), it is a good place to store your money safely, and with a reasonable return on investment.
This is particularly relevant if you are looking to invest more than £ 50,000, as higher investments that are not guaranteed by the government unless they are invested in a product of national savings.
If you find the prospect of safe investments, but predicted no interest, Premium Bonds might be a good option for you, as they give you the opportunity to potentially win a great prize, without losing the original capital as you would playing the lottery.
