Two or three year Fixed Bonds

sindersoot

cvd wrote: »

I have a fixed term bond maturing with the Coventry at the end of this month and they have offered me a new 3 year bond fixed at 5.1% gross p.a with 90 days loss of interest on any amount withdrawn before the completion of the term on 31.08.2012.

This bond is not advertised on their web site. I do not know if this is because it is new or they are only planning to offer it to existing bond holders to tempt them to leave their savings with the Coventry.

I have a similar fixed rate savings account with the Halifax and they have offered a rate that is higher than that on offer on the high street. Must be an incentive for you to keep your money with them. The rate I have been offered is 3.60% fixed for one year but I can definitely do better elsewhere even if over a longer term BoS can't match what is out there.

alanq

NS&I Guaranteed Growth Bonds are offering 3.75% (taxable) for 2 years. Unlike some accounts offering higher rates the investment is accessible with just 90 days loss of interest. Worth considering for cautious savers with large balances.

I wonder why the NS&I 2 year fixed rate saving certificates offer such a poor rate - 1.25% tax-free which is equivalent to 1.56% to a standard rate tax payer or 2.08% to a higher rate tax payer.

SmileyG_2

Primrose wrote: »

Nobody really knows what's going to happen to interest rates over the next two or three years so I think splitting the money into three separate accounts with differing maturing times makes a lot of sense. You say you don't pay tax at the moment. If there's any likelihood that you might end up doing so over the next three years the other option is to protect your future interests by putting some of the money in a cash ISA.

Some savings providers offer Fixed Rate Cash ISAs; you can get the best of both worlds!

Furthermore, as the fixed rate products mature, you can roll them over and add to them, preserving the tax free status. I like the idea of "laddering", it does offer you significant protestion against interest rate changes (rather like 'pound cost averaging' when buying shares or unit trusts"

SmileyG

alared

ctdctd wrote: »

I've just gone for the Principality 5.1% for 3 years and two months.
HTH

Has this bond now expired?
The best I can see for a 3year fix is 4.4%

Hungerdunger

You're right - it has been closed. It was only available for a week or two, which is a shame as I have an account maturing on Tuesday and would have transferred it all to the Principality.

If you see a market-leading offer, I think you'll find they usually don't last long. Earlier this month The Hanley offered a 4% 6-month bond, but that disappeared quickly.

Andystriker

alared wrote: »

Has this bond now expired?
The best I can see for a 3year fix is 4.4%

Yes.

Taken from Moneyfacts Website:



DIRECT FIXED RATE BOND Issue 143 paying 5.11% will be withdrawn w.e.f. close of business 25.8.09.

pdx123

Dunfermline Building Society offer a 3yr fixed rate bond paying 4.5%...not too bad:

http://www.dunfermline.com/savings/3-year-fixed-rate-bond.aspx

Hungerdunger

pdx123 wrote: »

Dunfermline Building Society offer a 3yr fixed rate bond paying 4.5%...not too bad

As long as you don't already have £50k in the Nationwide/Cheshire/Derbyshire/Dunfermline group. (Assuming you don't want to risk going over the FSCS limit)

Primrose

Hungerdunger makes a good point and one that anybody with a large chunk of cash savings needs to bear in mind all the time now that so many financial institutuions have merged as hardly any of them are keeping separate registrations for the various names. Some are keeping separate registrations but only for limited periods of time so if you're taking out a fixed term bond, check this out before you sign up for it.

Stavros_3

pdx123 wrote: »

Dunfermline Building Society offer a 3yr fixed rate bond paying 4.5%...not too bad:

http://www.dunfermline.com/savings/3-year-fixed-rate-bond.aspx

Why tie your money up for 3 yrs?, You can get 3.75% 1 yr fix, then see whats about in 12 months time. IMHO 3 yrs is too long for me