There have been occasional rumours going around for much of the last decade that interest rates would go up. So today they finally did. How did King Carney’s decision affect King Cashbags? Er…not so much actually.
The rise is modest, up from 0.25 % to 0.5%. Now I don’t know about you, but I don’t have any bank accounts which are paying more than the current inflation rate. So when we hold money as cash we are losing out. And call me a pessimist, but I don’t expect any of the banks to boost their interest rates on savings accounts any time soon. So I’ll be looking at what more investing I can do, rather than holding savings in cash.
My favourite investments are property and stocks and shares. I have a stocks and shares ISA. If you don’t have one yet, think about it. I’ll post a bit more about what I’m doing on that score separately.
I have two mortgages. One is a five year fixed-rate with three more years to run so unaffected by today’s announcement. The other is a smaller mortgage on a rental property. This is a tracker, so there will be a small increase but it will be minimal and will not make much of a dent in the Cashbags gold reserves.
We bought Castle Cashbags a couple of years ago. This was our second property, having purchased our first home ten years ago. I will post more about my property investments soon.
There could be more rises to come however, so worth reviewing your mortgage situation sooner rather than later. More generally, I can offer you the following pearl of wisdom. If you adopt the Cashbagger Mindset, you live within your means, have very manageable debt and enjoy life as you dream of early retirement. Cheers to that!