'Should I cash in my NS&I Index Linked Certificates?'

09th May 2018

I have some NS&I Index Linked Certificates that are maturing soon. Should I cash them in or roll them over?

NS&I Index Linked Certificates

You lucky thing!! NS&I Index Linked Certificates are no longer on general sale, if they were they would be sold out in moments, as they offer great value. No other savings account will guarantee that your return will keep up with inflation. And the inflation measure used is the Retail Prices Index (RPI), which is higher that the Consumer Prices Index (CPI).

At the moment, RPI stands at 3.30%. CPI is 2.50%.

There are three Index Linked Certificates currently available but, as mentioned before, they are only available to customers with maturing certificates. There is a 5 year term, a 3 year term and a 2 year term (although this last option is only available when renewing an existing 2 year certificate). All pay an index-linked return, plus 0.01% tax free/AER.

So, if you chose the 3 year option and RPI remained static at 3.30%, you would earn 3.31% per year tax free. That is by far the best savings rate on the market currently.

Having said all this, we don’t know what will happen to inflation and interest rates going forward, although we do know that the Bank of England is trying to reduce CPI inflation down to the Government’s target of 2% - which would mean that RPI inflation would fall too.

As things stand today, if you don’t need the money you should think very carefully before cashing in and losing access to these inflation-busting savings accounts.

*We are occasionally paid by some providers if you click through from our Best Buy Tables and open a savings or current account with them. We will never accept a payment that compromises in any way our independent, whole of market approach to providing information on savings products. For clarity we will indicate those companies who remunerate us with an asterisk (*).

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