Good reads from around the Web.
The wait is nearly over, glass-half-full-fans of a certain age. National Savings and Investments (NS&I) has revealed the first firm details of its upcoming ‘Pensioner Bonds’.
More is to come with the launch in January, but here’s what NS&I  says so far:
What are the bonds?
- Lump sum investments providing capital growth
- Choice of terms – 1-year and 3-year
- Designed to be held for whole term, but can be cashed in early with a penalty equivalent to 90 days’ interest
When do they go on sale?
- January 2015 – exact date to be announced
- Available for a limited period
Who can invest?
- Anyone aged 65 or over
- Invest by yourself or jointly with one other person aged 65 or over
How much can I invest?
- Minimum for each investment £500
- Maximum per person per Issue of each term £10,000
What about interest?
- 1-year Bond 2.80% gross/AER*
- 3-year Bond 4.00% gross/AER*
- Fixed rates, guaranteed for the whole term
- Interest added on each anniversary
The tax position
- Interest taxable and paid net (with basic rate tax taken off)
- Higher and additional rate taxpayers will need to declare their interest to HM Revenue & Customs (HMRC) and pay the extra tax due
- Non taxpayers, and those eligible to have any of their interest taxed at the new 0% rate (which starts from April 2015), can claim back the tax from HMRC
- Sorry, we’re not currently part of the R85 scheme so we can’t pay the interest gross on these Bonds
While the rates may still look laughably low to 60-somethings who remember the days of 10% interest on their savings, the bonds are table-toppers for those who are eligible to put money into them – and the 4% rate looks unbeatable, even with cash ISAs.
Here are a few media takes on these new bonds from:
Who says there’s no upside to getting old? 🙂
From the blogs
Making good use of the things that we find…
- Why does everyone tout complex portfolios? – Oblivious Investor 
- Some people will never learn – A Wealth of Common Sense 
- Software is eating investment management – Abnormal Returns 
- Are oil stock dividends safe? – Sizemore Insights 
- Investing in illiquid shares – iii blog 
- Are you being shown the whole market? – Maven Capital Partners 
- Riding the rollercoaster – DIY Income Investor 
- The case for investing in Bonmarche – Stockwatch/iii 
- Hedge funds: The state of play – Above the Market 
- Working for the man: A last resort – Raptitude 
- How I screwed up my financial independence – Mr Squirrel 
- Where are the economists yachts? – Investing Caffeine 
- Learn from the losers – Tim Hartford 
- The case for a universal income – Simple Living in Suffolk 
- See the financial wood for the money trees – Under the Money Tree 
Mainstream media money
Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber of that site.1 
- Ignore forecasters at all costs – Swedroe/ETF.com 
- Jack Bogle’s blind spot: International diversification – Yahoo 
- 3 lessons from a stock market ‘freak out’ – Roth/AARP 
- Dump your S&P index fund [Well, maybe !] – MarketWatch 
- Passive investing’s foundations [For passive nerds] – Swedroe/ETF.com 
- Don’t overlook the risks of individual bonds – MorningStar 
- Giles Hargreaves: 3 AIM stocks to buy and hold – Telegraph 
- Lessons from the sorry Beacon Hill saga – ThisIsMoney 
- 10 shares that pass the Buffett ‘moat’ test – Telegraph 
- John Lee: Focus on your existing shares [Search result] – FT 
Other stuff worth reading
- 122 things everyone should know about investing – Housel / Fool 
- Proof that you should get a life and work less – The Economist 
- Expensive estate agents are ripe for disruption – Guardian 
- ‘I spot and exploit pricing errors for a living’ – Telegraph 
- How to really invest like a billionaire – MarketWatch 
Book of the week: Who would have thought the rise and fall of an investment bank could make for gripping reading? Catching Lightning in a Bottle , written by the son of a Merril Lynch co-founder, chronicles how the Wall Street giant was led astray in the years prior to the financial crisis.
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- Reader Ken notes that: “FT articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”.” [↩ ]