NS&I certificates

A question about : NS&I certificates

NS&I index linked savings certificates are back

Best answers:

• ... but, only the five year jobbies and at RPI + 0.5% pa.
• But it looks like you can withdraw after a year without any penalty -
  Can be cashed in early, but no index-linking or interest paid if cashed in during the first year.
  It's looking like a tax free 5%-ish one-year savings account to me at the moment?
  Unless I've missed something?
• This looks better than any isa on offer almost too good to be true and you know what they say about things too good to be true! What's the catch?
• Exactly! That's what Im worried about before piling in.
  The trouble is I dont want to hang around for much longer as these deals are always taken away very fast.
• On the one hand, the Bank of England is telling us inflation looks set to rise, and growth diminish, yet at the same time the price of oil and wheat has dropped recently and healthy company results keep popping up. Whatever happens, a guarantee to beat inflation means you can't actually lose money.
• I'm trying to discover what the interest deal is if you withdraw after one year as the Terms & conditions on the NSI website arn't specific. Do you suffer any penalty at all or are you paid the promised interest rate up to the date of withdrawal?
• What about the several ISA 5-year accounts that pay RPI plus 2% (Kent Reliance BS) and 1.5% (Yorkshire BS)? The headline interest addition sounds better that NS&I - what is the catch, and why don't all the newspapers compare these accounts with the NS&I?
• Do I have this wrong???
  I read that the interest paid was the difference in RPI each year.
  So, if yr 1, it started at 4%, then 12 mths later was 3%, you only get paid 0.25%.
  Same calc cumulative each year. So, you don't get paid lterally RPI plus bonus, if RPI drops (currently high), it may be pretty rubbish.
  If I have that wrong, can someone please explain!
  Ta
• You have it wrong.
  If it's 3% next year, you get 3% plus the interest.
• I think you have it right.leloup