Over 50s predict FTSE, base rate and inflation for the end of 2017

Wednesday 28 December 2016

  • One in five correctly predicted where the FTSE 100 Index would be at end of 2016
  • Only a quarter think the FTSE will increase by the end of 2017
  • One in six think the FTSE will decline by the end of next year

Around one in five over 50s correctly predicted the 2016 closing range for the FTSE 100*, this is twice as many as predicted the correct closing range last year, suggesting that they are becoming accustomed to the financial climate in the UK.

The Saga Money poll of over 11,600 over 50s suggests that some investors will be delighted with the performance of our Blue Chip companies this year as a third predicted the FTSE 100 would be performing worse than it currently is.

When it comes to the battle of the sexes men’s bullish outlook has held them in good stead this year as one in four correctly predicted where the FTSE 100 Index would sit by the end of 2016, compared to just 1 in 13 women.

A quarter of over 50s have a positive outlook for 2017 as they believe the overall value of Britain’s 100 biggest companies listed on the Stock Exchange will increase**.

However, on average, the Saga generations predict the FTSE 100 will be around 7,008 this time next year; with 1 in 25 thinking it will break 7,400 next year.  Only one in six think the FTSE will be lower by the end of 2017.

Men are more optimistic than women as they’re three times as likely as women to think the FTSE 100 will increase (36% and 12% respectively). 

When it comes to the Bank of England Base Rate, many over 50s have been sorely disappointed this year.  Along with many experts who thought things could not get any worse for the base rate, almost four in ten over 50s predicted that the base rate would rise by the end of 2016.  For this group of people, many of whom are  dependent on their savings interest to boost their income the further decline in the base rate has come as a heavy blow.  That said, they are optimistic that we will see an increase by the end of 2017, typically thinking that the rate will rise to 0.75%.

When asked about inflation the majority of over 50s believe that we will see a further increase in 2017. On average, people believe the consumer price index will be around 2%, which could be a huge blow to those on a fixed income in retirement.

Sally Merritt, head of product, Saga Money, commented: “The decline in the base rate  has really affected those relying on their savings for income  this year, highlighting for many that they may be best off investing their money for the chance of a higher return. 

“We can see from our research that many over 50s are particularly savvy and keeping a close eye on the financial climate, which is key for people trying to make their money work hard for them throughout their retirement.”

ENDS

 

 

Notes to Editors:

*Populus interviewed 7,880 Saga customers, all aged 50*, online between 15th and 18th December 2015. Populus is a member of the British Polling Council and abides by its rules.

**Populus interviewed 11,656 Saga customers, all aged 50+, online between 22nd and 29th  December 2016. At the time of conducting the poll the FTSE 100 Index was 6,778.

 

About Saga Investment Services

Saga Investment Services has been developed to open up the world of investing and financial planning to the UK’s over 50s in the run up to and throughout retirement, and to make the process as simple and stress-free as possible. Customers can invest from just £100, and have access to investment advice and financial planning services. Saga Investment Services champions a straight forward and transparent approach to investing, and is a proud member of the Plain English Campaign. It is a joint venture between Saga, the leading provider of services to the nation’s over 50s, and Tilney Bestinvest, the expert investment and financial planning group.

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