Investment advice £30,000
Discussion
My sister has £30,000 sitting in an account at a well known bank earning peanuts.
She probably will not need to access it for five or six years but this may change if her circumstances do.
She needs 100% security so shares etc, are out because they could go down.
I realise the interest rates are going to be pretty poor wherever it goes, how about premium bonds?
Thanks in anticipation, obviously coke and hookers are a no no.....
She probably will not need to access it for five or six years but this may change if her circumstances do.
She needs 100% security so shares etc, are out because they could go down.
I realise the interest rates are going to be pretty poor wherever it goes, how about premium bonds?
Thanks in anticipation, obviously coke and hookers are a no no.....
with 30,400 in premium bonds , you have odds of "winning" 25 a month , or essentially 1% per anum.
it is tax free , and can be accessed back in a couple of days . in a year have got 25 every month
Its no great shakes but secure and beats the normal savings accounts right now.
I do this, and have averaged slightly over 1% this last year
it is tax free , and can be accessed back in a couple of days . in a year have got 25 every month
Its no great shakes but secure and beats the normal savings accounts right now.
I do this, and have averaged slightly over 1% this last year
PM3 said:
with 30,400 in premium bonds , you have odds of "winning" 25 a month , or essentially 1% per anum.
it is tax free , and can be accessed back in a couple of days . in a year have got 25 every month
Its no great shakes but secure and beats the normal savings accounts right now.
I do this, and have averaged slightly over 1% this last year
Thank you it is tax free , and can be accessed back in a couple of days . in a year have got 25 every month
Its no great shakes but secure and beats the normal savings accounts right now.
I do this, and have averaged slightly over 1% this last year
PM3 said:
with 30,400 in premium bonds , you have odds of "winning" 25 a month , or essentially 1% per anum.
it is tax free , and can be accessed back in a couple of days . in a year have got 25 every month
Its no great shakes but secure and beats the normal savings accounts right now.
I do this, and have averaged slightly over 1% this last year
Put your numbers through here https://www.moneysavingexpert.com/savings/premium-...it is tax free , and can be accessed back in a couple of days . in a year have got 25 every month
Its no great shakes but secure and beats the normal savings accounts right now.
I do this, and have averaged slightly over 1% this last year
The top prizes of £1m skew the averages, so it's better to look at the median, rather than the mean, when anticipating payouts.
To have earned over 1% is doing well (luck).
Premium Bonds is probably the best bet. The only way to get a higher return is to compromise on either the risk level or the minimum term. There are reasonable rates to be had with notice accounts (~90days) https://www.moneysavingexpert.com/savings/savings-... but to get much over 1% you'd need to go at least 12 months fixed.
bmwmike said:
5-6 year timeframe seems reasonable for a stocks and shares ISA with a global tracker fund or something relatively safe i'd have thought.
I'm not sure about that. My money is in a stocks and shares ISA but I would be quite concerned there could be a market correction in the next five years and that you'd maybe have less than you started with. I don't need my money in five years though so I'm keeping it in there.
bmwmike said:
5-6 year timeframe seems reasonable for a stocks and shares ISA with a global tracker fund or something relatively safe i'd have thought.
Whenever I hear "100% security", that person is generally either (a) not ready to invest, or (b) is using funds that cannot be exposed to any risk. In which case, the options are very, very limited e.g. cash, premium bonds, Govt bonds.The current "100% security" rate for 5 years is currently 0.63% UK Gilt 5 Year. If Gilts, I'd be inclined to purchase the shortest term Gilt, and roll it over at maturity. Inflation is a risk that this rarely considered because it is so insidious (loss of purchasing power).
Be very, very careful about fixed rate term products that are in actual fact bonds. There is a reason why the rate is 2/2.5x higher than the 5 Year Gilt i.e. you are taking a risk on the solvency of the company offering the bond, and you need to check, double-check, and triple-check that the product is covered by FSCS.
putonghua73 said:
bmwmike said:
5-6 year timeframe seems reasonable for a stocks and shares ISA with a global tracker fund or something relatively safe i'd have thought.
Whenever I hear "100% security", that person is generally either (a) not ready to invest, or (b) is using funds that cannot be exposed to any risk. In which case, the options are very, very limited e.g. cash, premium bonds, Govt bonds.The current "100% security" rate for 5 years is currently 0.63% UK Gilt 5 Year. If Gilts, I'd be inclined to purchase the shortest term Gilt, and roll it over at maturity. Inflation is a risk that this rarely considered because it is so insidious (loss of purchasing power).
Be very, very careful about fixed rate term products that are in actual fact bonds. There is a reason why the rate is 2/2.5x higher than the 5 Year Gilt i.e. you are taking a risk on the solvency of the company offering the bond, and you need to check, double-check, and triple-check that the product is covered by FSCS.
That said, cash or anything less than inflation is 100% guaranteed to be less than you started with, in buying terms, so I guess one persons 100% security is different to anothers. Gawd, can't help myself.. must.. stop.. typing.
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hstewie said:
hstewie said: Does she need 100% security for the whole £30K?
For example leave £27K (or whatever) as cash but put £3K into stocks or something with a chance of downside but also a chance of upside.
I was going to reply with the same. 1% seems hardly worth it when a small fraction of the 30k could do much better with reasonable risk exposure. For example leave £27K (or whatever) as cash but put £3K into stocks or something with a chance of downside but also a chance of upside.
Wacky Racer said:
My sister has £30,000 sitting in an account at a well known bank earning peanuts.
She probably will not need to access it for five or six years but this may change if her circumstances do.
She needs 100% security so shares etc, are out because they could go down.
I realise the interest rates are going to be pretty poor wherever it goes, how about premium bonds?
Thanks in anticipation, obviously coke and hookers are a no no.....
Bank accountShe probably will not need to access it for five or six years but this may change if her circumstances do.
She needs 100% security so shares etc, are out because they could go down.
I realise the interest rates are going to be pretty poor wherever it goes, how about premium bonds?
Thanks in anticipation, obviously coke and hookers are a no no.....
Premium bonds
But if she isn’t willing to take any risk then just a regular savings account for her
Don’t get paid for not taking risk nowadays
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