Take it out and spend it or what do you advise please?

tdiman

We have always shied away from risky investments. Paid off the mortgage, got no debts, both took out isas and never ever dabbled with shares, as we didn't understand them. BUT there comes a time when the promise of a guaranteed return is too tempting - so we took a punt - only a smallish one. My wife invested (:rolleyes: ) in a west brom guaranteed return bond. We did the deal ib August 08 with the ftse at - wait for it - 5371 - it will mature in aug 2012 based on the average of the ftse over this period. So should we bite the bullet and take our money out or leave it till 2012 and still get back what we put in as I can't see the ftse recovering enough or at all to guarantee the final sum?
Worst case scenario I will lose 4 years interest - so should (if I can) withdraw the cash and open another isa, invest or have a spending spree?

Your views appreciated

D1zzy

Your options see to be a return of B***** all or half of B***** all, with current interest rates. If its only a small amout is there much difference? Are there any penalties if you withdraw? & Who knows where the FTSE will be in 3 years. If you don't want to get into shares directly (which looks to me a good option at the mo) I'd leave it and wait to see what the gov come up with to assist savers and make a decision then - unless a spending spree would lift yr spirits in which case go for it!
(Best saving option I can come up with at the mo is A& L/Abbey 2 year fixed at 4.01% - but whether that is worth it depends on the amount and your penalties)

tdiman

Good idea - are there penalties? - I will check with west brom before acting. On phone now. I hadn't thought about penalties.
Lee

RayWolfe

There will be penalties if it's allowed, which I doubt.

tdiman

Well good and slightly bad news

We can transfer or take cash with no penalty to our original investment.
The penalty for cash is loss of 180 days interest, which amounts to £41 - a no brainer then?
or transfer back to a west brom mini cash isa (which was where it was to start with) and there would be no penalty.

We are off to the local branch to sort.
Will keep you updated - I am mindful that info from one source sometimes conflicts with another.
Lee

D1zzy

If its not too late check out fixed rate isas - nationwide 3% for 2 years, 3.25% for 3 years - but there may be others

sh856531

The penalty for cash is loss of 180 days interest, which amounts to £41 - a no brainer then?

£41 is barely a loss at all in the current climate

:-)

tdiman

Hi

panic over.
We were sure we had taken out the bond that offered end of term guarantee of 40% IF the average of the ftse didn't fall or only your initial investment back if it did (makes sense?)
what wasn't pointed out to us was that it also had a guaranteed 3.5% per year too. Just back from branch and we have decided to leave it where it is. Funnily enough they don't offer this one now - issue 4

Thanks for replies and advice

Lee