Your Money | Melanie Bien
Who said 'never a borrower be'?
Sunday 23 December 2001
Savers and investors should be happy to see the back of 2001. Those invested in shares watched in dismay as the market continued to disappoint. Those with money in savings accounts saw their returns plummet as the Bank of England repeatedly cut interest rates. Those with Equitable Life pensions watched with increasing despair as thousands of pounds were slashed from the value of their funds, leaving those nearest to retirement facing penury.
There was some good news, however. Low interest rates resulted in some of the best mortgage deals ever. A large number of people remortgaged their homes to take advantage of this, while others turned to buy-to-let, encouraged by a growing range of specialist loans and a booming rental market. What's more, as property prices steadily increased – although not at the levels we have seen in the past two years – capital appreciation made getting a foot on the property ladder ever more attractive.
So what does 2002 hold for us? Well, experts predict a recovery in the stock market, which is good news for investors, although it seems unlikely this will take place before the end of the year. In the meantime, it is probably worth drip-feeding your money into an individual savings account to give you broad exposure to the market. After all, a recovery will mean an increase in share prices, so it makes sense to pick up a few while they are cheaper.
The housing market is also expected to hold its value next year. There has been a slight slowdown in the number of viewings per property but, on the whole, values remain steady. Sharp increases in property prices are unlikely – that has already happened – but realistically priced properties should continue to sell. Mortgage rates are already beginning to climb, with Nationwide increasing its fixed rates last week – so move quickly if you are thinking of buying a property or remortgaging.
As far as pensions are concerned, the Government's consultation on annuities should be published by the end of this month and will be up for debate at the beginning of next year. The best solution seems to be not abolition but a tweaking of the rules, allowing people to guarantee a basic support level with an annuity and then do what they like with any funds above that.
As for Equitable Life, the result of the compromise vote will be announced next month, giving a clearer idea as to the future of the insurer. Let's hope that a compromise is reached: there is precious little alternative.
All we know for sure is that 2002 is bound to be full of surprises that will affect our personal finances – all of which we will follow in these pages. Until then, I would like to wish all of you a very happy Christmas and a prosperous new year.
- 1 Al Pacino on suffering from depression: 'It can last and it's terrifying'
- 2 Half of young women unable to ‘locate vagina’ and 65% find it difficult to say the word
- 3 Saudis risk new Muslim division with proposal to move Mohamed’s tomb
- 4 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 5 Mexican woman becomes world’s 'oldest person' at 127
Rotherham child sex abuse scandal: Labour Home Office to be probed over what Tony Blair's government knew - and when
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Ashya King: Parents of five-year-old boy refused permission to visit him in hospital and denied bail at Spanish court
With Douglas Carswell joining Ukip, my party has taken another giant step forward
When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
Ashya King: 'Cruel NHS has not given us the treatment we need', says father of five-year-old with brain tumour who fled to Spain
iJobs Money & Business
£35000 - £38000 per annum + benefits: Ashdown Group: A highly successful, glob...
£60000 - £75000 per annum + BONUS + BENEFITS: Harrington Starr: Business Anal...
£40000 - £50000 per annum + benefits+bonus+package: Harrington Starr: SQL Impl...
£85000 per annum: Harrington Starr: Head of IT (Windows, Server, VMware, SAN, ...
Day In a Page
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location
A one-bedroom apartment located within a private gated development, north of Turnham Green
Look forward to a brighter future at two-bedroom Sunny Cottages, ideal for Londoners looking to downsize
A three-bedroom red-brick cottage with outbuildings and pretty gardens, £200,000
This three-bedroom flat within a former textile factory spans the corner of the fourth floor and has a balcony