Fixed Rate Bond - is this too long?

johng_uk

polybear wrote: »

Hi all,
I'm considering a fixed rate Bond for 2 or 3 years (I already have some 1 year Bonds). I've been offered some very good rates (over 8%) but do wonder if the timescales are too long for tying up money, from the viewpoint of possibly losing out in the future?
I'd be grateful for any thoughts please! Thanks.

Brian.

I'd also be interested in the 8% offer Brian. I think a few people on here would appreciate it if you would take the time to post the link on here.

opinions4u

Dodgy Abbey thing where they put half in to something risky after luring you in with 8%+ rate?

If a bank needs to pay 8% for a 'normal' fixed term investment, ask yourself why.

1) Is it short of wholesale funds and going wobbly?
2) Is there a massive catch?

polybear

An Update:

The savings bond was offered to me by a man from the Barclays - for periods of 3, 4 and 5 years he was talking 8%, 9% and 9.6% p.a. (respectively). After a failed promise to call me back last Thursday he eventually called me back this morning.

But now it seems the product has mysteriously changed to an Investment Bond - I got suspicious when he mentioned phrases like "capital is guaranteed" and "those returns are almost guaranteed" (heard that one before....).

Thanks, but no thanks. If I want an Investment Bond I'm sure there are better deals than Barclays anyway.

So now I have £35K looking for an alternative good home....

Brian

Primrose

polybear - I think you're right to avoid these investment bonds like the plaque. I had one once and after three years I got back exactly what I had invested and not a penny more. I invested at a time when the stockmarket was rising and thought I had a reasonable chance of making a decent profit. Then the market collapsed and I would have done better sticking the money in an ordinary savings account. If I had cash I was absolutely sure I wouldn't need I'f fix for two years, but I'd be a little wary about three years. With the current economic situation, are you 100% sure you won't be made redundant and might need access to that cash? If you're retired your circumstances might be different, but I think Icesave are still offering 6 mos, 1 2 & 3 years bonds if your happy to use Internet banking. Perhaps split the money and opt for two or three different length periods?