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Building Society Rates - Building Society Rates: A Great Investment Opportunity For Troubled Times

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For folks In the U.K., joining a building society has many advantages. These institutions are all part of a larger group – the Building Society Association. It is owned either by a limited group, or more commonly, by a number of individuals. Since all members essentially share a stake in the ownership, it can operate in basically the same way as an American credit union. This means such functions as loaning money, savings and checking accounts and investment vehicles are available to any member in good standing. That is why they are sometimes referred to as co-op savings groups, since the pooling of resources is done by everyone involved.

The idea of a building society goes all the way back to the 1830s, where each person of membership owned a home. It was then closed to newcomers. They were still quite prevalent until the 1980s, when laws were passed to allow them to compete with banks, carrying the same types of financial investment opportunities. The number of building societies has dropped recently, due to the downturn in the economy and the consolidation of several groups.

Building society rates can vary depending on the type of investment that is sought. After the period of mergers was essentially finished, the interest rates paid out to many savings accounts was actually lower than before. This was true for any individual who was a member of a building society that had merged with another financial institution. A study at the University of East Anglia showed this trend to be true for at least six years following the consolidation between the two parties.

On the other hand however, there are specials available to society members that rank with the best deals traditional banks can offer. For example, the Leeds building society offers investors the chance to place 60% of their money into a stock market portfolio called the Norwich Union. The remaining 40% can then be placed into into their own Leeds option bonds which have a high fixed rate of return. This type of deal is rarely seen outside of a group such as this, and is a great example of building society rates that make good sense for members.

There are currently 50 active building society groups in the United Kingdom at this time. This downturn is mainly due to the 3 year financial crisis that caused many businesses to close up shop. It also helped to weed out the smaller and less stable groups, creating a more vibrant community of lenders in this area. The largest company listed is Nationwide building company with assets of 202,361 million £, while the smallest – Century building company, comes in at 24 million £. At the present time, all are on solid financial ground, still able to offer the kind of services that a regular bank does.

In order to obtain the best building society rates however, it is necessary to do some investigation first. This process has been shortened considerably by the decline in the sheer number of these groups that are still in business. With the ready availability of the Internet, it is easy to do some comparison shopping. Many websites will perform the side by side view of competing firms, making it apparent which has the right investment options. There are also specials run for the regular members. A higher interest rate is available for those people who make regular monthly deposits. Of course it may depend on how much the account was started with at inception. Then too, there may be some consequence for withdrawals, so the best advice would be to check their policy beforehand.

Another great advantage to building society rates is the possibility of a fixed term. Depending on the financial forecast, it might be more beneficial to obtain a long term or short term investment vehicle. The former is good unless the analyst predicts a nationwide drop in the future. In that case, it is wise to grab a short term rate while still doing some speculating in the long term area. By putting money into a wide variety of investments, there will always be income available. That is one of the guiding principles of building societies.

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