I've been keeping an eye on the interest rates on both savings accounts and mortgages recently, on account of the fact that I've got some money I want to keep liquid as FIAT that I'd like to earn interest on and because it will probably be financially efficient for me to remortgage next year.
What's odd is that I'm looking at some of the savings rates and thinking that they seem O.K.
For example there's a pretty tasty looking 5% on offer even at two well-known British banks and these aren't even the best offers.
O.K. So you can't earn that rate on very much, but for me it's enough because I just want somewhere to put my tax money every year and the max limits on these two accounts cover that.
But I'm also looking at the current best deals on 2 year fixed rate mortgages and, coming in at the same rate, they also seem O.K...
An overall borrow rate of 5.2% doesn't feel that scary, especially since it's in line with the interest rates on the savings accounts.
Of course this is only really fine by me as I'm saving my money for tax, so it's not being affected by inflation - I earned a certain amount and I'll a certain percentage of that - that is unaffected by the cost of living going up because it's ring fenced for the HMRC....
I'm not about to play games with that money!
Of course if one is factoring in the rising cost of living to this then the two above don't cancel each other out...
I could well be losing out on savings as inflation rises faster than that 5%, and I could also be losing on the mortgage if property prices fall faster than 5%.
But as it stands I'm looking at these interest rates as being O.K. for now, I might even have to chuck some into savings, and I certainly wouldn't be put off remortgaging at the above prices.
So no real impact on me yet from the cost of living crises!
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5% seems amazing compared to how it was! We arent near that in Germany, but maybe I should check further.
Those figures are on pretty small amounts, but it all helps!
You could get a second mortgage on your house, then put the money into the savings, pay the mortgage interest from the savings interest and keep the difference.
I know what you mean, it's like break-even!
You are doing great. Keeping in mind the 5% rule and still in a good position is nice. Good to know.
5% sounds amazing given the recent history of interest rates!
In greek banks these rates look like a wet, summer dream!
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