Old silver shilling

An old 1910 shilling. 92.5% silver. Worth about £1.92 at today's silver price - more than if you'd left it to earn interest in a bank for 100 years.

Category:

People & Blogs

Tags:

• silver
• bullion
• invest
• in
• sterling
• shilling
• 1910
• bank
• interest
• rates
• inflation

[quibble72]

Thanks, jadcott, for the input. I agree that this is very much a simplification and I certainly would like to be able to work this out properly.

I think if someone was continually seeking out the bank account that would give the best return for their money then the bank option may perform better. But I've certainly had a number of bank accounts that have paid less than 2% long before 2009. I also didn't deduct tax from the interest, which is something we would have to consider too.

[jadcott]

(please don't think I'm having a go about this - I have a great many of these coins purely because that I think they will do very well)

Such variables wouldn't be an issue when comparing two assets over a set period though.

Simplest way of looking at it would be to compare the silver price growth to CPI:

whatsthecost. com/cpi. aspx

indicates silver lost ~50% of it's relative value over the past century. If anything this under-performance shows silver is now currently undervalued.

[0muffins0]

@RainstormGB There are far more new 5 pences in my neck of the woods than the old ones now. I don't know why we still bother with those things now-a-days. You need handfulls of small denomination coins just to buy a coffee or a loaf of bread.

[0muffins0]

@jadcott There's an awful lot of other variables too, like the real inflation rate and the variable spot price of silver. It would be a challenging equation if anyone was going to work it out properly.

[RainstormGB]

they are quite rare the new 5ps not worth anything but not a lot about :)

[jadcott]

hmm... this would be an interesting thing to work out properly. It might not be as clear-cut as one thinks.

2% annual interest is undershooting things a bit . We had >10% rates for a significant part of last century. It never actually went below 2% before 2009. So avg interest rate is going to be markedly higher than that.

I make 5p → 192p over 100 years to be an annualised rate of 3.65%... there's actually a fair chance that the bank deposit would have performed better than the silver.