Where to put £45k?

[minimad69]

Seen a couple of threads but pistonheads sums of cash appearto be a lot bigger than this. A good friend of mine has £45k inheritance, and will be working away in Canada until around this time next year where he intends to buy a house upon his return. He will want to put minimal amount of effort into putting the money somewhere, and wants to just go to his bank and ask them where to put it for a year. Who I assume will just say one of their own low interest savings or ISAs, I think he's with Lloyds bank.

I suggested premium bonds, but what would you lot suggest? He'd like to be able to access a little in case of emergencies as he's not working for the next few months.

[rog007]

I’d put it all in Premium Bonds; little effort, lower risk (inflation) and followed by ease of access when he wants it out next year. And you never know; you have to be in it to win it!

[BobSaunders]

There is a similar thread on here currently re. 200k.

Some good advice in there - in places.

[drainbrain]

You can still get 1/33 on Celtic to win the SPL.

[Jockman]

Best I'm seeing is 1/50.

[drainbrain]

Probably slipped again after today's results (Aberdeen dropped 2 points) but 10Bet'll give you 1/41 tonight. Waste of time now really.

[sidicks]

rog007 said:

I’d put it all in Premium Bonds; little effort, lower risk (inflation) and followed by ease of access when he wants it out next year. And you never know; you have to be in it to win it!

Why is this lower risk than a bank deposit?

And I’m pretty sure savings accounts will have a higher (expected) return than premium bonds.

[FWIW]

sidicks said:

Why is this lower risk than a bank deposit?

And I’m pretty sure savings accounts will have a higher (expected) return than premium bonds.

Which savings account?

[TheInternet]

sidicks said:

Why is this lower risk than a bank deposit?

And I’m pretty sure savings accounts will have a higher (expected) return than premium bonds.

A savings account with the interest spent on lottery tickets offers higher expected returns, doesn't it?

[12TS]

£20k in a Santander 123 gets you 3%

[sidicks]

TheInternet said:

A savings account with the interest spent on lottery tickets offers higher expected returns, doesn't it?

I doubt it, as the expected return on the lottery is very low!

[TheInternet]

sidicks said:

I doubt it, as the expected return on the lottery is very low!

PBs are also pretty dire, however thinking about it the expected return must be higher than the lottery.

[TheInternet]

12TS said:

£20k in a Santander 123 gets you 3%

1.5% nowadays, though I'm sure with the recent BoE rate rise Santander will be rushing to bump it up.

[sidicks]

TheInternet said:

PBs are also pretty dire, however thinking about it the expected return must be higher than the lottery.

Yes. But less than a savings account, which is the obvious answer for the OP.

[WindyCommon]

TheInternet said:

sidicks said:

I doubt it, as the expected return on the lottery is very low!

PBs are also pretty dire, however thinking about it the expected return must be higher than the lottery.

Expected return on the lottery is negative.

[TheInternet]

WindyCommon said:

Expected return on the lottery is negative.

Indeed.

[kmpowell]

TheInternet said:

12TS said:

£20k in a Santander 123 gets you 3%

1.5% nowadays, though I'm sure with the recent BoE rate rise Santander will be rushing to bump it up.

1.5%, but a £5 a month fee on the account . So after fees your interest is about £20 a month. Put decent direct debits in and your 'cash back' can give you a few quid back.

I have 3x 123 accounts with £20k in each, moving standing orders between each account to ensure I hit the minimum requirements. It's the best I could find for something that's 100% risk free savings.

[FWIW]

But at c.1.5% your return is less than inflation.

[12TS]

FWIW said:

But at c.1.5% your return is less than inflation.

Best you're going to get on cash deposit though.

[kmpowell]

FWIW said:

But at c.1.5% your return is less than inflation.

Show me somewhere else where I can get a better rate on £20k cash, with instant access and zero risk, and I'll bite your arm off.

These are my 'cash pots' which sit outside of my SIPP and other risky investments. Not money I want tied up elsewhere.