BOSS: The Inflation Goblin

Lesson 12 of 12 in our free Saving & Emergency Funds guide: a 5-minute money game with the key points below.

This lesson is in the full version.

Free with a code from your uni, college, council, landlord or employer (worth £600/year). Lesson 1 of Saving & Emergency Funds is free for everyone.

Questions you'll answer

Mo's emergency pot is full. He's saving for a first home in 6 years. Inflation is 3.1%. Which move fits?

Final hit: Mo has £2,000 saved at 4% AER with inflation at 3.1%. Roughly what's his real return in £ after one year?

Fact: “A savings rate below inflation means you're losing buying power.” — Real return is negative. The pound number goes up; what it buys goes down.
Myth: “Your ISA allowance carries over if you don't use it.” — It resets every 6 April.
Fact: “An emergency fund should be easy to access.” — Emergencies don't wait for a fixed term to end.
Myth: “The LISA charge only removes the bonus.” — It's 25% of the withdrawal — you lose some of your own money too.