Easyrider;250001 wrote:Just received my annual statement on one of my certificates.
It has increased from £7,295.86 to £8,218.62 in the last year. The interest capitalisation amounts to £0.73, but the index-linked return is £922.76. The grand total therefore is £922.76 for the year.
This represents a percentage increae in RPI of 12.63%. As the return on these certificates is tax free the hypothetical gross return for a 40% taxpayer is 21.05% for the year, assuming my Maths are correct.
I doubt very much if National Savings expected to be paying this level of index-related return. The interest capalistion is only 0.01%.
My guess that this largess will provide a great incentive to control and reduce inflation. I therefore expect inflation to start falling soon.
Great news
A lot of friends have always been questioning why, despite not going anywhere for over a decade I keep persuading them to never sell these things.
Hopefully when they see the return they can see the rationale.
Even better is the fact that you have calculated the % return and whilst the monetary amount may not pay for a shooting break (thanks to the extortionate price hikes) the can clearly see a 21% return in a market downturn year (and I will no longer need to plead them not to sell such instruments like a broken record).