to think savings will be worthless?

[HopelessLayout]

So governments are printing money hand over fist to cover all the Covid bailouts. Isn't this going to cause hyperinflation when it is all over?
I have modest savings put away for my retirement in a few years' time, but perhaps I should just blow the lot now.

Please tell me if I am misunderstanding the situation.

My interest rate on my savings was pretty awful anyway, about 0.1, but now down to 0.01. I've moved a chunk over to premium bonds instead.

It is worrying and yet again the government is rewarding people who live beyond their means. Savers always seem to get the shitty end of the stick.

Is there anything big you have put off purchasing?

They’re borrowing money not printing it.

Interest has been below inflation for some time I thought? So yes in real terms your savings would be worth less/buy less in a few years time than now. But that’s not the same as worthless by a long shot.

If you can commit to locking your money away in a Fixed Rate bond , they’re paying up to 1.55% for 12 months ( I’m using Investec ) as of today, then look online at sites like Moneysavingexpert for advice. No one should accept the paltry rates offered by most companies. Shop around.

if you're based in the UK, OP, how much inflation happened in the 10 years after the 2008 crash, OP? Not to say the UK couldn't face inflation, 70s stagflation or even German 1930s hyper-inflation but if the government and the BoE could kick the can down the road with QE plus whatever new financial management innovation cooked up since then...

My friends and acquaintances who made millions+ post-2008 are expecting a further killing provided the losses are socialised and the gains privatised.

I've been wondering if it would be worth taking some savings and putting them towards my mortgage.

Savings for retirement should be in a pension fund...really bad idea to keep long term savings in a standard savings account, especially with interest rates as low as they have been for the last 10 years!

I noticed that my modest SIPP funds plummeted by 40% at the start of all this, they are back to the level they were before now, I’m invested globally with a fair chunk in tech and biotech.

MoneyBox on Radio 4 had some useful tips of long term savings accounts last weekend I think. If you can tie the money up for a period of time then the rates definitely improve - when I say improve it's still not massive.

You could put your money in to Premium Bonds. They sit there doing nothing, but the more you have, the more likely you are to win and then you get a little windfall every so often. I know self-employed people who do that with their tax money. Earns a bit tax free if they win and easy to get out when it comes to January.

You should be saving the money in an investment vehicle of some sort that will have much higher returns. OP said she would be retiring in a few years. This is terrible advice. No one would recommend investment unless you wanted to hold it for AT LEAST 5 years.

You shouldn’t have retirement money in a normal savings account though. You need to invest in a pension.

I am not concerned about low/non-existent interest rates (well I am but they've been rubbish for years, though not as rubbish as now).

But someone with no debt and a decent level of savings, I also worry about hyperinflation. I do sometimes wonder if I should liquidate my account and buy gold but that's what everyone does and the gold price goes up!

If you have a mortgage hyperinflation is great, except that you still need to eat and you don't want to be having to spend a million pounds on a loaf of bread.

Should I ditch my savings for some other kind of investment ?

It depends on how much you have and when you need to access it.

Once you’ve got more than a few months’ regular income, then unless you have a specific expenditure in mind (e.g. new car, extension, holiday of a lifetime) any additional savings should not really be in a savings account.

You can transfer lump sums into a pension, get 25% added by the government, and then access it in a few years when you retire. The key thing would be to make sure that whatever the underlying investment is is something which is not going to be volatile, like shares will be for the foreseeable.

Talk to an IFA.

I have been wondering about gilts, given the amount the government is set to be borrowing in the next year or two.

Saving for retirement in a standard savings account hasn’t even worthwhile for about ten years now.

Don’t buy crypto either.

There are two types of savings for retirement there is the obvious a pension that pays out monthly or is in a draw down scheme this will normally be in an investment type package, and should be where the bulk of retirment savings are. the other is to put away some money for retirement to enable some capital purchases not out of pension income, ie money for a new car, a holiday or just extra treats now if you are approaching pension age this should be more leaning to cash in a safe investment with a guarantee; you can get more than 1 % if you will leave money for 12, 24 months or even 5 years it is still safe you can't lose the capital but it should be in a bank account paying 0.1 % you can get more in safe government bonds

Eminent economists can't agree on this one.
The only certainty is that if you blow it all now, you'll have nothing left for later.

I've put a chunk into Premium Bonds: they're guaranteed by the government, and you can take the money out any time you want to. Not at all risky, compared to "investments" of any sort.

I had a medium sized chunk of money in a savings account, I saw exactly what it made in interest last year: put it into PBs and in five months I've already had three small wins, which have exceeded that amount of interest.

So I'm already in "profit", there's half the year yet to go and who knows, I might even win a "big" prize, woo hoo!

The government printed/owe so much money that they want to keep interest rates down to inflate away the debt. So banks have lowered interest on savings and hiked them on credit cards instead.

Apart from a pot for emergencies and saving for short timer like a bathroom replacement all savings are in ISAs or pension funds.

We still have 12 years before DD will draw his pension and 16 for me. We hope that by then the funds have recovered.

DD has a pot with investment funds for higher education.

Cash is never a good way to save long term.

Do something dynamic with your savings! Don’t just stick it in a savings account - of course it will do nothing. Open a stocks and shares ISA in a bull market you can make some good money. Contact your bank.

And another one saying to buy into crypto-currencies

I owned circa £33's worth of Bitcoin. It's now worth £24.50. It's not the panacea people tout it to be

When the bullion dealers reopen, I'll be buying some silver rather than leaving money in the bank.
I did this years ago with gold and it proved a good investment.

I second the poster who suggested buying some Bitcoin but that is more of a gamble than metals.

Where did you hear they were printing money? I’ve not read this

There are some good books on economics you can read

Apparently there was no inflation in Japan. They have loads if debt to GDP.

For a while now I've just considered banks to be convenient storage places for money.