Current Balance = £3001.04
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Where I’m investing my money in 2009 – Part 2

My second investment for 2009 is a bit more unusual as I have lent my partner money so that she could buy an annual season ticket for her train journey to work. Despite frequently reminding her that a lack of credit in the market place is driving up the cost of borrowing I have lent her the money interest free as it’s only for a couple of months.

Train operators raise their prices on the 2nd January every year, with the rise in fares being far more punctual than their trains. This year my partner was facing a price hike of 6%, but by buying her ticket a few days before the increase she was able to save herself this additional cost. 

An annual season ticket also works out cheaper for her as it’s discounted slightly compared to buying monthly season tickets, although this saving is generally eroded when you consider the cost of capital and potential savings whilst you might be holiday. That said she is still better off not having to pay the increased prices.

So what’s in it for me? Well one of the benefits of her season ticket is that she gets 1/3 off rail travel for both her and up to 3 other passengers travelling with her. And as we travel into London by train quite frequently this should help me save a few pounds over the year.

Where I’m investing my money in 2009 – Part 1

So far my adventure has earned me over £2000 which I currently have sitting in a current account paying next to nothing in interest so it’s time to start thinking about making this money work for me.

Now normally the stock market is a good place to look for good returns but given the current instability in the markets I’d prefer to invest my money into something a little bit safer.

Now you might not thinks banks are as safe as they were but seeing as the Government seems to be guaranteeing all savings they are still a safe bet. However interest rates have plummeted in the last three months from paying an average of 2.46% in September to just 0.81% in December (Source: Bank of England). And it’s likely to only get worse as this is before January’s 0.5% interest rate cut.


Five days of market turmoil

Wow… what a week it has been for the markets. The term ‘Credit Crisis’ can now takes its place amongst the ‘Dot.Com bubble’, the ‘1987 crash’ and ‘Black Thursday’ as it will be a long time before the markets forget this week (or indeed the events that may still be to come).