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Expat Investor : July August 2008
Savers are much more cautious now than a year ago, with one in ten people thinking their money would be safest under the mattress, reveals new research from Newcastle Building Society. In light of the credit crunch, the number of people preferring to stash their cash at home has almost trebled up from four per cent to 11%. However, more savers would prefer to invest in building societies than anywhere else, with over a third (34%) believing them to be the safest places. The past 12 months have seen the number of people choosing to invest in either banks or building societies decline by 17%, according to the research. A year ago, almost three-quarters of people surveyed would have considered banks (28%) or building societies (46%) to be the safest places to invest their money. Wendy Lee, Commercial Director at Newcastle Building Society, believes that although consumer confidence in financial institutions has, unsurprisingly, declined over the past year, it is encouraging to see that building OFFSHORE SAVINGS July/August 2008 ? EXPAT INVESTOR 7 Fast Facts 66003 *AER stands for Annual Equivalent Rate which is a notional rate illustrating the contractual rate as if paid and compounded on an annual basis. Zurich Bank International Limited, PO Box 422, Lord Street, Douglas, Isle of Man, IM99 3AF, British Isles. Telephone: +44 (0) 1624 671666 Fax: +44 (0) 1624 627526. www.zurichbankinternational.com Registered office: 43-51 Athol Street, Douglas, Isle of Man, IM99 1ET, British Isles. Zurich Bank International Limited is registered in the Isle of Man Number 22847. Telephone calls may be recorded. Licensed by the Isle of Man Financial Supervision Commission for banking business. The Zurich Bank International 1 Year Fixed Rate Bond (Issue 7) gives you a superb annual interest rate of 6.70% gross. So if you want your money to work hard for the next 12 months, call us for an application form today. • Interest rate fixed for one year from account opening • minimum balance £10,000 • limited issue. www.zurichbankinternational.com We’re fixing it for a year 6.70% GROSS PA/AER* Zurich Bank International To find out more, or request an application form call: +44(0)1624 671666 Email: email@example.com or visit our website (quoting ref no. EI7) R societies still come out on top, with over a third of people still considering them to be a safe option. “These findings are a stark sign of the times, but they are also exacerbated by the hype surrounding the ‘credit crunch'. With some attractive savings products available, you might think people are barmy to stash their cash at home. “Unfortunately, some savers now have an exaggerated view that investing their money with a building society or bank can be a risky business, which is not the case,” says Ms Lee. “People should speak to their savings provider if they are looking to invest or if they are concerned about existing investments - in the vast majority of cases people will be reassured.” Confidence in banks has declined by 5% over the last 12 months with less than a quarter of savers (23%) considering them the safest place to invest their money. And the number of people who are unsure about the safest place to put their money has almost doubled to 13%. An additional 19% would choose not to invest with traditional financial institutions at all. Age can also affect attitudes towards investing money, with 41% of people aged over 55 currently considering building societies to be the safest place to house their savings. This drops substantially to “While we welcome the news that building societies are mostly favoured by those aged 35 and above, societies are also an attractive option for the younger generation and offer a good variety of competitive savings rates.” only 21% in people aged from 18 to 24 years. Ms Lee continues, “Building Societies have an excellent track record for providing a safe place for savings for those with a little, or a lot, to invest. One in 10 prefer to stash cash under their mattress W HERE B RITS CHOOSE TO HOUSE THEIR SAVINGS Where would you have invested Where is the safest place to £10,000 12 months ago? invest £10,000 now? Bank 28% 23% Building society 46% 34% Under the mattress 4% 11% Elsewhere 16% 19% Don’t know 7% 13% For contact details, readers are directed to the offshore savings tables printed on page 12 of this issue. cuts in UK Base Rate in February and April, we have been able to hold our savings rates and will do so whilst market conditions allow…. We understand the importance of issues such as reliable and transparent interest rates, and our reputation built up over the last 10 years is testament to this. Savers nowadays can be confused by some of the newer offerings appearing, so we think it is reassuring to be able to rely upon a tried and trusted home for your savings such as Skipton Guernsey.” Other offshore deposit-takers who are currently holding their position in the best rates league tables across the three main currencies, sterling, US dollar and euro, include the following: Bank of Scotland International, Scarborough Channel Islands, Investec Bank (CI), Schroders (CI), Fairbairn Private Bank, Royal Bank of Canada (CI), Clydesdale Bank International, Abbey International, Bradford & Bingley International, Standard Bank, Lloyds TSB Offshore, Irish Permanent International, and Irish Nationwide (IOM). Expat savers should bear in mind that in all cases, the best paying accounts apply In certain categories. If you find a best-paying no notice account, do not assume that that particular offshore deposit-taker will be offering the best paying accounts available under different terms. It may well be that best –paying accounts on notice terms are available from a different provider. Always compare like-with-like and make sure your research covers a number of savings account providers.
May June 2008