Latest RPI figures(1) show annual RPI at 3.2%. Yes, it varies, but I
don't see any savings account(2) paying much more than 3.2%. So, it's
0.05%+RPI AND tax-free. Difficult to beat? Probably worth rolling over
some of your savings into the reinvestment certificate.
(1): monthly figures [for Sept 2013 RPI] published this morning as it
(2): See e.g.
The certificate that is maturing may have paid 1.35%+RPI, but the last
time 1.35%+RPI was available was available was 42nd index-linked issue,
available April 2007 to April 2008, when it dropped to 0.35%.
Bear in mind that savings certificates are not currently on sale, so you
can't buy fresh, the only certificates available are those that are
It's debateable whether you'd buy new ones (if you could) at the
currently available rates, but rolling over (at least a few of your
spare pennies) would be worth considering.
Yes you are right I was looking at the original 2007 paperwork. We then
reinvested in 2010.
I suppose nowadays beating inflation is the best one can do out with the
Although interest rates must surely rise in the next three years.
I'm rolling over all my index linked certificates even though the
interest rate on the bit of borrowing I do have is about 1% higher than
the rate (inc inflation) that I'm getting on the certificates because
there's no way to buy more when you have spare cash and there's no safer
way to get an investment to beat inflation.
I've also got some fixed rate certificates - when I bought them I
thought you could convert them to index linked when they mature but I
believe that has now been taken away. So depending on the rate on offer
and whether I have any remaining borrowing by the time they mature I'll
toss up whether to reinvest them or not. But if it turns out I can turn
them into index linked certs then I'll definitely do that.
If you have lots of borrowing at a rate above inflation and you do not
expect to pay it all off for a long time then I'd probably say cash them
in. Effectively, reduction in interest paid on the loan is also a tax
free gain. But otherwise I'd say hang on to them - if it turns out you
need the money in the future you can cash them in and otherwise you've
got tax free index linked capital until you need it.
I skipped some issues completely because they came too close together
and I didn't have the cash immediately available so I'd have had to
borrow short term to buy them. I regret that decision now because later
I was in the opposite position of surplus cash but no certs availble to
Yes, that's my understanding too: you used to be able to re-invest
maturing fixed rate certs into into index-linked certs. This was very
handy, and thankfully I got most of mine done*. I believe the ability
to do this was stopped when they changed a whole load of T&Cs a year or
so ago (IRIC Sept 2012).
*: I also used to be able to amalgamate several maturing certificates
into one cert (at a push). This was very useful as it cut down hugely
on the paperwork and admin, and the number of small certs. However, I
think the ability to do this has also gone (shame). You'd have thought
that NS&I would appreciate the ability to do this (to reduce admin &
paperwork etc), but they don't seem to be able to accommodate those
sorts of ideas.
Part of me says "spend it on yourself".
Another part of me remembers that savings certificates don't necessarily
have to be cashed in on death (I'm dealing with this for my mother's
estate as the moment), and can be passed on to your heirs (should you so
wish). Your beneficiaries might appreciate some tax-free savings
(especially when savings certificates are not for sale at present, and
haven't been for some time). That does of course depend on the
situation/needs of estate and the Will, and the knowledge of the exors
etc etc etc
Another nice feature of Savings Certs (if you die) is that they can be used to pay the Inheritance Tax before probate has been granted. This breaks the usual impasse: no probate until tax paid, no accesss to the assets until probate.