The bank of England recently voted to keep interest rates at their
record low of 0.5%. It is over three years now since the base rate fell to its
record low and there are no signs that interest rates will rise any time soon.
This is a major problem for anyone needing to receive an income from
their savings. Cash has lost over 10% in value over the last three years* as a
result of inflation.
This combined with austerity measures savaging our personal finances
mean it is crucial to ensure we get the most from our investments.
The best equity income funds have succeeded in not only protecting
investors’ savings from inflation but creating growth as well.
Income funds are not just a good hedge against inflation. Nor
are they just for those investors looking for a source of income. Global
brands with strong balance sheets are proving resilient to tough economic times
and paying healthy dividends. If these are reinvested rather than taken as income,
the size of our returns can grow and grow.
Moneyspider.com, a unique fund monitoring, rating and comparison
service, can show you which funds to consider. If you have an equity ISA, Unit
Trust or OEIC, get a rating, an online report available 24/7 and see how they
compare against other funds with the same and other sectors.
Ignorance is not bliss when it comes to losing money.
Source: Moneyfacts.co.uk
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