MoneyMagpie founder warns investors to think before selling shares

As the Bank of England raises interest rates to 3%, Money Magpie CEO Jasmine Birtles warns investors to think carefully before selling shares.
The Bank of England has today voted to hike interest rates to 3%.
The 75 basis points increase is the highest made by the UK’s central bank in 33 years.
The FTSE 100 is up 0.6% today showing that markets anticipated the hike. Despite this, higher interest rates often have a detrimental impact on the value of stocks and shares.

Commenting on the Bank of England’s latest base rate hike, Jasmine Birtles, CEO of Personal Finance website, Money Magpie, explains why investors shouldn’t rush to sell their shares in the current environment.

“Rising interest rates are rarely good for stock markets. A lot of investors redirect their funds into savings accounts as they see the numbers rising. The belief is that savings accounts are safe so if they’re offering higher interest rates they are a better bet than ‘risky’ stocks and shares.

“However, with inflation at an official rate of 10.1%, savings account interest rates would need to quadruple in order even to just match inflation, let alone beat it. Admittedly, average stock market returns tend not to get into double figures, unless you’re in a good year, but all least they significantly beat average savings returns.

“Personally I still don’t think it’s worth putting more than you have to put into savings accounts to be a decent safety net. Any money you’re looking to grow for the future needs to be in a mixture of other assets including stocks and shares, gold and possibly property.”