Best way to open Nationwide eBond

hallmark

Hello

I have approx £30K am thinking of investing in a Nationwide eBond. Quick question:

Since it says you can have multiple ebonds am I correct in thinking that it's far better to open 3x £10K bonds than 1x£30K bond? Because you get exactly the same benefit but you have the flexibility that you could close just one bond or two if you had to, wheras with a single £30K bond it's all or nothing?

thank you

RayWolfe

Yes, that makes sense but if you are unlikely to need the 30K why not do one for 5K, just for emergencies and the rest in another or split it between a one year and a two year if you think rates may go down.

Milarky

http://www.nationwide.co.uk/savings/e-bond/legal.htm

11. The e-Bond can be closed prior to maturity, subject to the following early access charge (these charges will not apply on closure due to the death of the account holder).
Term Remaining.......... More than 3 years.... 2-3 years............. 1-2 years........... Less than 1 year
Loss of interest............ 180 days.................... 150 days.............. 120 days............. 90 days

You can have as many bonds of the same type as you wish. You could split them equally - or you could set them up with staggered amounts - like 6, 9, 15 - and you aren't restricted three, so you might like to divi up your total more finely still.

But whichever you do, loss of 3 months interest is quite a hit

feralkitten

I've set up several one-year bonds with them, at roughly two-month intervals. This way, you can have access fairly promptly as they mature in sequence. There is also the opportunity to switch to one year bonds with others (e.g. Anglo-Irish currently at 7.05%) when interest rates are better elsewhere. Obviously, it means a smaller sum for each bond. and you could even set up 12 over the year, with one maturing every month. It's not a bad hobby!