No risk fund with income?

[Old Merc]

I`m 67, mortgage & dept free,pension pot safe,have other savings,earning a small amount part time.
At the end of the month I will have about £52K free.
I would like to invest it in something risk free,earn reasonable interest(if that`s possible?)and then in say three years time start drawing a monthly income.

Any suggestions chaps?.

I have a good financial adviser but I would like other peoples feed back before my meeting.

[megaphone]

First ensure you make the most of your ISA allowances.

Anything 'risk free' will give a poor return. Lots of investment funds are 'lower risk' but are still affected by the stock markets, if we have a crash your fund value could well go down. Have a look at Invesco Perpetual High Income, done reasonably well over the years

http://www.hl.co.uk/funds/fund-discounts,-prices--...


There are investment plans available that will return all you capital after, say 5 years, even if the plan does not do well. Most of them are tracking stock markets and pay out if the index stays higher than the original bench mark. Ask your FA.

[Ginge R]

3 year Pensioner Bond for some of it?

http://www.nsandi.com/65plus

[jeff m2]

Something to consider.
The less risk you think you are taking brings you quite close to inflation.

[Ginge R]

Sometimes, a higher sense of certainty for a lower return is better than aspiring for a lower sense of certainty from a return that aims to shoot the lights out. At 65, you have (hopefully/possibly) made what you aimed for and now it's time to circle the wagons and go into coast mode. Some clients are happy (rightly so) to remain ahead of inflation by just a couple of points.

[gregf40]

If you want interest above inflation you need to take some risk.

I'd stick it in LandBay. They will lend it out to BTL let landlords and the money is secured against the property - you will get around 4.5% interest over 3 years (and can cash out early if you choose).

[jeff m2]

gregf40 said:

If you want interest above inflation you need to take some risk.

I'd stick it in LandBay. They will lend it out to BTL let landlords and the money is secured against the property - you will get around 4.5% interest over 3 years (and can cash out early if you choose).

The default rate for BTL is around 7%, actually not that good. Considering the rate for Corp High Inc is just a little over 2% and gives a div of about 5.6%.
However, I do like Real Estate Reits funds esp if you can get them into some sort of wrapper to protect the divs from tax.

Looking forward on BLT default rates, I cannot see them riding out an interset rise very well!

Age, risk return, diversification. Many people have no target or even know how long they will survive and what their needs will be as they age.
As one retires or stops working there is not a switch that is thrown and all your equity is transferred to Bonds (gilts) or simply put on deposit.

Enter stage left Mr Ginge who I have never seen make a bad post.

[gregf40]

jeff m2 said:

The default rate for BTL is around 7%, actually not that good.

Not sure where you got that figure from - but it's wrong:

"UK Buy-to-Let, as an asset class, has historically been very resilient. In 2013 the mortgage default rate was just 0.09%, being fewer than one property per 1,000. At the peak of the 2008 Global Financial Crisis the BTL default rate was 0.35% (source: Council of Mortgage Lenders, 2008 & 2013)."

https://landbay.co.uk/faqs/ (Number 4 in the Lenders section).

[jeff m2]

gregf40 said:

jeff m2 said:

The default rate for BTL is around 7%, actually not that good.

Not sure where you got that figure from - but it's wrong:

"UK Buy-to-Let, as an asset class, has historically been very resilient. In 2013 the mortgage default rate was just 0.09%, being fewer than one property per 1,000. At the peak of the 2008 Global Financial Crisis the BTL default rate was 0.35% (source: Council of Mortgage Lenders, 2008 & 2013)."

https://landbay.co.uk/faqs/ (Number 4 in the Lenders section).

I pulled the 7% from my head from something I read somewhere. (I read a lot) I just googled and it appears FT have it at 3.7% in default and 2.9 for owners.
I have no idea which is correct, let's hope it's yours

[Ginge R]

Jeff,

If that was to me, thank you - it's very kind of you to say so. 'nuff said.