|
Saving up for your collection
Saving up for something special right now, such as
a memorabilia collection, is not exactly easy. The Bank of England's interest
rate is just 0.5% and whatever money you do have in savings, unless it is in a
high performing account, is getting eroded in real terms by the 3% inflation
the UK is currently experiencing.
So what options do you have? If you don't want to
rely on credit then you will have to save the hard way to pay for that very
hard to come by vinyl. You will need to look for savings accounts with APR
rates of 3.5% or higher. However, there is one problem with these accounts; you
will have to leave your money in the bank for up to two years. Instant access
savings accounts have much lower rates - around 2.5% - so with inflation at 3%
you aren't going to make much cash of note in real terms.
Don't just leave your money at home either. 5% of
the population are choosing piggy banks as their savings account of choice and
your money really isn't going to work very hard for you here. As much as
£2.4 million is being saved at home accruing no interest, therefore
inflation is actually eating away the real value of this money.
If you need money now and maybe the item you want
has a time limit, then by far the best option is to take out a loan. Many
people are afraid of getting into debt at the moment, so much so that record
numbers of people are paying off mortgages and loans. However, interest rates
are at some of their lowest levels they have been in years. What's more, banks
aren't allowed and also aren't willing to offer loans to 'risky' customers
anymore, so you don't need to worry about being unable to pay back the loan. If
the bank doesn't think you can make the payments you won't get the loan.
Before choosing a loan, thoroughly research the
market for the best rates and lowest costs. You need to work out how much you
can afford to borrow and how much you can pay back each month. If you know what
you are doing and what you want before you enter the bank, you are much more
likely to be taken seriously and given the loan you are after.
Santander offers some of the best rates on
loans at the
moment. The Spanish banking giant can offer a rather tasty 8.9% typical APR
which beats all of its major competitors including HSBC, Barclays, Lloyds TSB
and NatWest. |
|
