merlin
Minor shareholder in Assetz and many other companies.
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Post by merlin on Jan 2, 2015 18:24:03 GMT
I posed the question as I am seriously puzzled as to the source of the all cash that is pushing the P2P market along. Certainly all the signs are that the market is continuing to grow at a pace. Is it coming out of the Building Societies, Premium bonds, The Stock Market or even under the floor boards like mine? It has to be coming from some where and the source could have implications, like for instance the Building Societies where if enough money is taken out it could impact on their ability to lend and that in turn could affect house prices, etc., etc.
What's your views folks and need we be concerned?
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bugs4me
Member of DD Central
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Post by bugs4me on Jan 2, 2015 18:34:27 GMT
<snip>
What's your views folks and need we be concerned? No need for concern in my book as even if the P2P market doubled or tripled over the next 12 months it would still be a drop in the ocean compared to the savings/deposits that are held by the banks and BS's. What is happening is that a small minority of the population are waking up to the simple fact that the grass is greener elsewhere albeit with a bit more risk attached. Nonetheless inertia will continue to rule IMO in the vast majority of cases.
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Post by davee39 on Jan 2, 2015 18:35:09 GMT
Mine has all come from maturing bank/building society savings bonds.
Since savings institutions have all taken the p*** during the funding for lending taxpayer funded beano I would shed few tears over any rates increases caused by shortage of funds. I certainly hope the Pensioners Bonds (which I do not quite qualify for) cause a few ripples. My experience was that The Yorkshire and Coventry BS's were a little less keen on the game of 'stuff the saver' they have all played.
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Post by westonkevRS on Jan 2, 2015 18:45:42 GMT
It is estimated that £32billion is invested in cash ISAs annually, with an average return of 1.7% (obviously many paying a pittance, and most below the long run inflation rate).
If P2P lent £1billion approx in 2014 then this puts P2P in perspective. It gets press because it's new and sexy, but it is indeed a drop in the financial services ocean.
Moreover, much of the stated £1billion P2P lent is institutional, although not at RateSetter. It would be interesting to get this split across all platforms.
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pikestaff
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Post by pikestaff on Jan 2, 2015 19:00:21 GMT
I agree with bugs4me that the flow into p2p currently is a drop in the ocean. Like davee39 the vast majority of my money has come from maturing bank/building society bonds. I only woke up to p2p when it was no longer possible to get 4% even by stretching the term out to 4-5 years, which was about 2 years ago so I've still got some bonds with a couple of years to run. However, I'm under no illusions that p2p is a direct alternative to bank/building society bonds. It's a different and more risky asset class - even where there is a provision fund. Unlike davee39 I don't blame the institutions for the low rates on offer on savings products. It's entirely a consequence of economic conditions and government policy. But I do believe that low rates are here to stay. |
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Post by cautious on Jan 3, 2015 7:53:28 GMT
Also funded by my matured building society bonds because I live off my interest......I had no where else to save really
I suspect that the pensioner bonds will be way over subscribed and withdrawn quite quickly.
I am expecting a tiny rate rise sometime after the election, probably the last quarter of 2015.
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baz657
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Post by baz657 on Jan 3, 2015 10:02:17 GMT
All of mine has come from a significant six figure inheritance (from a house sale) and a hefty six figure payout from my bank, both in the last six months which I've spread over different platforms, investment plans and investing in my business.
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Post by GSV3MIaC on Jan 4, 2015 11:37:46 GMT
Building Society accounts in my case .. even the best BSs (among which I number Skipton, Cambridge, and Yorkshire) have succumbed to the "we're not allowed to give them a 'hair cut' but we can apply growth retardant lotion" solution to the economic woes (i.e. everyone, from the government down to the tea boy, spending what they haven't got and in many cases have b*gger all prospect of ever getting).
If they ever get P2P ISAs set up I might go raid some BS ISA accounts too, or even stocks and shares .. but only up to some rational limit, P2P is still well risky compared to a mixture of asset classes.
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baldpate
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Post by baldpate on Jan 4, 2015 17:49:41 GMT
So far my forays into P2P lending have been funded out of a combination of BS savings, supplemented to a degree by surplus pension income. My interest was sparked by the announcement of future inclusion of P2P in ISA's : I have quite a lot of savings in S&S ISAs (mostly brought forward from the PEP era), and I am rather too heavily biased towards equities for a person of my age. But the cash ISA alternative is unattractive, as are bonds at this point in the interest rate cycle. If P2P ISAs ever come off, and providers are willing to accept transfers of 'old' ISA money, I can see myself rebalancing my portfolio by moving a significant portion of my S&S ISA money into P2P.
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shimself
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Post by shimself on Jan 4, 2015 18:23:53 GMT
... P2P is still well risky compared to a mixture of asset classes. Can you envisage circumstances where let's say AC and Ratesetter and FC all hit the buffers at about the same time, whereas Building Society accounts / equities / corporate bonds still have value?
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oldgrumpy
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Post by oldgrumpy on Jan 4, 2015 18:32:57 GMT
Building Society and Post Office Bonds maturing, inheritance - (my late mother was expected to pass on, but my little brother wasn't!!! Didn't even make 60!), emptying Building Society Savings accounts (before Christmas Birmingham Midshires were awfully reluctant (?) to reduce my on-line savings account interest to 0.7%, but they were going to do it anyway). Yorkshire and Barnsley aren't much over 1% so I suppose they will be "forced" to reduce to sub 1% before long. My last bond C&G "step-bond" matures in a month. Substantial amount. Been paying 4.75% for the last year. Bet they wish they hadn't launched that one in 2011. It'll have to go through my bank, and I guarantee that within four hours I will be phoned, I won't be in, I will be asked to phone my "personal advisor" at the bank urgently ON HIS MOBILE PHONE number about my account and I will ignore it. Eventually they will catch me and I will have to go through all the reasons AGAIN why they will have no part whatsoever in the re-investment of the money. They will act surprised and ask why (IMBECILES!), so 1. Your borrowers will get a nice low rate, but 2. from my money you will still make profit and pay all your staff and pay for expensive TV advertising 3. your senior staff will get more bonus than I ever got salary, but if you make big losses I as the taxpayer will be expected to bale you out, and yet what you offer me WILL ENSURE THAT I AM THE ONLY PARTY LOSING VALUE.  Most of this is fuelled by government policy using taxpayers' money, governments which for years have been shouting at us for not saving enough for our old age - (but they still force interest rates on savings down commonly below 0.8% THEN CONTINUE TAXING THAT 0.8% to the tune of 20% or even 40%!!!) . RANT OVER!  Much as I'd like to put a lot more into P2P/P2B I daren't put too high a proportion into that particular sector, and I feel I'm already close despite spreading widely. Equity Income Investment Trusts are going to need looking methinks .... I believe H/Lansdowne will be helpful there. Too many management fees on Unit Trusts (though I pay no initial fees) - or am I wrong there? (and anyway, being in them for 15 years continuously hasn't been much of a money maker). |
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agent69
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Post by agent69 on Jan 4, 2015 19:56:25 GMT
Currently funding my P2P/P2B empire via spare cash at the end of the month (can never seem to get expenditure to match income). I use to take up my full cash ISA allowance , but haven't bothered this year due to the terrible rates. Had some undesirable results with FC last year so now my main exposure is at TC, with significant amounts on RS and AC. Despite my liking for TC I have decided to avoid the current offering from the scrap dealer (once bitten as they say).
Like most I accept that risks are higher, but if things went t*ts up would just have to put off early retirement for a year.
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Post by uncletone on Jan 4, 2015 20:02:55 GMT
May I join your club?
Where did my money come from? Liquid Life savings, and my dear mother-in law who had this four bedroomed detached house in west London and only two daughters....
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markr
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Post by markr on Jan 4, 2015 20:12:28 GMT
For me I wish I wasn't in P2P! My investments are mostly from my wife's death in service benefit, life insurance and pension payouts. But what will be will be, and I'm a lot more fortunate than some young widow(er)s that I know, who were left only debts.
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Post by bracknellboy on Jan 4, 2015 20:48:23 GMT
markr: Condolences and sympathy. It must be particularly painful to lose your partner at an unexpectedly young age.
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