Premium bonds

[worsleyweb]

Damn. I read the thread title as premium blondes...

I can tell you from experience they don’t produce a great return on investment.

 

[Scottyboi]

I do know this, and you're right sort of, but not completely.

The interest is subject to tax. Whether you have to pay it will depend on the personal savings allowance and whether you get any. Yes you *may* have a £1k allowance, but you may not. If you pay additional higher rate tax, your allowance is zero.

But the interest is subject to tax, in the same way that income is subject to tax. No-one would say that income is not subject to tax would they, but you get a personal allowance which means you might not pay any on that either.

I'm going to hazard a guess that this won't ally to the OP.

Additional rate taxpayers do notreceive a PSA and must pay tax on anysavings income they receive onsavings outside an ISA account. As a result of the new PSA, the majority of savers in the UK no longer have to pay any tax on their savings income

 

[Chippy_boy]

I'm going to hazard a guess that this won't ally to the OP.

Additional rate taxpayers do notreceive a PSA and must pay tax on anysavings income they receive onsavings outside an ISA account. As a result of the new PSA, the majority of savers in the UK no longer have to pay any tax on their savings income

Agreed. I was merely disagreeing with your statement that "the £350 is not taxable". It is taxable.

And also, with respect, your comments about ISA's above are a bit irrelevant. You were suggesting how someone can make £350 by switching bank accounts.

Incidentally, I am not entirely sure that the £125 isn't taxable either. In the case of cash backs on purchases, it is not treated as income, but as additional disount on the purchase price and is therefore not subject to income tax. In the case of switching accounts, where you are not "buying" anything, this is moot. It would be interesting to hear how the HMRC views this.

But overall, I do agree with you that most people reading this thread would not have to pay tax on the £350.

 

[Scottyboi]

Agreed. I was merely disagreeing with your statement that "the £350 is not taxable". It is taxable.

And also, with respect, your comments about ISA's above are a bit irrelevant. You were suggesting how someone can make £350 by switching bank accounts.

Incidentally, I am not entirely sure that the £125 isn't taxable either. In the case of cash backs on purchases, it is not treated as income, but as additional disount on the purchase price and is therefore not subject to income tax. In the case of switching accounts, where you are not "buying" anything, this is moot. It would be interesting to hear how the HMRC views this.

But overall, I do agree with you that most people reading this thread would not have to pay tax on the £350.

I've checked it all out on MSE, the cashback for changing is an incentive so isn't taxable.However say if I referred you to a bank and I got money it would be taxable as its effectively commission.

I'm planning on giving that kuflink a try this year you get 250 cashback on a 5k deposit and then 5% plus for 12 months.

 

[Chippy_boy]

I'm planning on giving that kuflink a try this year you get 250 cashback on a 5k deposit and then 5% plus for 12 months.

It's not appealing to me to be honest. If you've got £5k and only £5k then to get £250 and maybe 7% on your money for 1 year is pretty good. But if you put more in of course the £250 becomes increasingly irrelevant and what matters is the risk and the return. 7% is OK ish for something that is relatively low risk, I guess, but it's not fabulous. I've had money in Lindell Train Global Equity for the past 3 years and their performance over the past 5 has been:

02/05/14 - 02/05/15 - 28.9%
02/05/15 - 02/05/16 - 8.36%
02/05/16 - 02/05/17- 29.61%
02/05/17 - 02/05/18 - 20.48%
02/05/18 - 02/05/19 - 24.42%

Cumulutive, +171%, which in an ISA is tax free, as you say. Shame I didn't have more to put in, and didn't do it sooner! £10k in in 2014 would now be worth £27k.

 

[Scottyboi]

It's not appealing to me to be honest. If you've got £5k and only £5k then to get £250 and maybe 7% on your money for 1 year is pretty good. But if you put more in of course the £250 becomes increasingly irrelevant and what matters is the risk and the return. 7% is OK ish for something that is relatively low risk, I guess, but it's not fabulous. I've had money in Lindell Train Global Equity for the past 3 years and their performance over the past 5 has been:

02/05/14 - 02/05/15 - 28.9%
02/05/15 - 02/05/16 - 8.36%
02/05/16 - 02/05/17- 29.61%
02/05/17 - 02/05/18 - 20.48%
02/05/18 - 02/05/19 - 24.42%

Cumulutive, +171%, which in an ISA is tax free, as you say. Shame I didn't have more to put in, and didn't do it sooner! £10k in in 2014 would now be worth £27k.

It would be for 1 year and then it would be going straight into my vanguard I reckon.

That fund you are in jesus christ decent that.

My mate on match betting forum put 100k into football index he has had an ROI of 41% in 6 months so far insane. Find it all interesting I only need 10k to match bet these days so I'm trying to find places to invest till time comes for me to buy a house.

 

[SWP's back]

Paying off debts (mortgage/cc’s) is now by far the best ‘investment’ available.

Disagree in the strongest terms about the mortgage or similar low interest affordable debt.

Paying off a mortgage (that had low rates and affordable repayments) reduces liquidity and the “return” over the last decade on the average mortgage is roughly 1/4 of an equity index tracker.

 

[SWP's back]

Hmmmmmm, I make that £350? My Premium Bonds netted me £575 over the last year and that's net, whereas the £350 is taxable.

First £1,000 on savings interest is tax free.

£500 if higher rate payer.

 

[Scottyboi]

Disagree in the strongest terms about the mortgage or similar low interest affordable debt.

Paying off a mortgage (that had low rates and affordable repayments) reduces liquidity and the “return” over the last decade on the average mortgage is roughly 1/4 of an equity index tracker.

You know shit loads regarding all this was just wondering do you think we will ever see decent interest saving rates anytime soon? Or does the bank simply not need are money as much anymore?

I look back and jesus people had it good in the 90s when it come to savings and house prices.

 

[Chippy_boy]

It would be for 1 year and then it would be going straight into my vanguard I reckon.

That fund you are in jesus christ decent that.

My mate on match betting forum put 100k into football index he has had an ROI of 41% in 6 months so far insane. Find it all interesting I only need 10k to match bet these days so I'm trying to find places to invest till time comes for me to buy a house.

Have you had a go at spread betting mate? Probably not for this thread, but I was out of work for 18 months and was doing that for a while. Once I'd found my way of working (and after a few er "mishaps") I was making really good money on that. I genuinely think you can start with a couple of grand and end up being a millionaire if you're any good at it.

The scary bit is you could start with a couple of grand and lose ten, which is why spread betting got such bad press. Too many muppets without much money thought it was a get rich quick opportunity and lost more than their shirts on it. So they've tightened up the margin requirements a lot now (i.e how much cash you need in the account in order to be able to place a small bet), which means it's safer, but also a lot more difficult to make an amazing return. I was making on average 1.1% *per day*, which when you think about it, is absolutely ridiculous - I was doubling my money every 13 weeks! The problem was (a) it was far to stressful for me, (b) it was super intense and all-consuming and (c) I kept losing shed loads of my winnings, which I found really emotionally difficult to deal with. You need nerves of steel and blood that runs ice cold to do it successfully. As the amounts I was betting got bigger, I lost my bottle, and then I got a job and don't have the time anyway.