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What I’ve done since the interest rate drop – Bryan Manley-Green, our Carefree Down-to-Earther

By Bryan Manley-Green | Date 16 Dec 2016

Having just returned from a beautiful cruise, we looked in horror at what had been happening to the savings market. I have a Santander 123 account, which used to pay 3% on up to £20,000, but that has now fallen to 1.5%. My Husband, Kevin, and I are lucky to have a regular savings account at the Yorkshire Building Society paying 3.75% a year. Although there are limits on how much you can save and withdraw, we’re starting to make the transition from our Santander account to the regular saver. However, it’s not open to new savers and it’s certainly not instant access.

I also took out a First Direct regular saver at 6% (now 5%) so that’s a shelter for some money, although it’s only for a year and then you have to start again.

When looking for decent rates, I find that it’s difficult to find a good return, especially if you want instant access to funds. Rising share prices mean dividend yield is decreasing, so the stock market is not necessarily a hiding place for us if we want some income. We’ve been waiting for the Innovative ISA to start, but that seems to have stalled, so it makes us wonder about putting more money into our peer to peer accounts at the moment. From what we’ve read, there are so many applications, the FCA simply can’t cope and it’s taking time. So for the moment, the interest on our money in Ratesetter and Zopa is taxable and, of course, their rates are also creeping downwards.

With inflation rising, I recognise that there is a perfect storm coming – especially for the over 50s. Our money is going down in value in real terms, becoming worth less and less over the years. Our age group is being attacked on all fronts.

We are looking at the stock market now, although we know that buying individual shares can be risky. What I like the most are investments that can benefit our lifestyle. We own shares in cruise operator Carnival, and not only does that pay us a decent dividend, it also provided us with $250 of on-board credit – far better than any dividend. If we do invest more, we’d like to see what perks we could get in addition to a good return, but they are few and far between.

I’d love to see a return to the days when I could get a 6% return on my savings, but with the referendum results and economic uncertainty, I don’t think that’s going to be arriving any time soon.

So, until then we’re focusing on the things that matter. At 63, Kevin was suddenly made redundant, so we’re looking through our pensions and planning how we’re going to be spending our retirement. That’s going to be much more fun than worrying about interest rates!

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About the author

Bryan Manley-Green

Bryan Manley-Green, 56, from Oldbury in the West Midlands, works from home running a translations agency and lives with his husband, Kevin.

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Important information

This article is not intended as advice. If you are unsure whether an investment is suitable, please contact an adviser.

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