It is becoming increasingly hard to make savings maintain their value, let alone increase it. In real terms, cash savings currently shrink when held on deposit, while yields on bonds have crashed and equities are uncomfortably volatile. The rush to gold as a safe haven and the consequent surge in its price shows just how anxious the market is as investors look for somewhere to park their savings that isn't going to leave them with less than they started out with.
Savers' problems are far from over. While the recent easing in commodity prices may pour some cold water on inflationary pressures, money printing by the Bank of England and the likelihood of other central banks following suit means further price rises will probably be on the way. In fact, the history of financial crises suggests that inflation will be the eventual outcome of the current mess. At the same time, many currencies look vulnerable and the prospect of European sovereign defaults looms large. To make matters worse, another recession could well be on the cards, both here and in other advanced western economies.
In trusts we trust