Abbey's Super Bond; Worth a Go?

portlandboy

Hi,
I have about £12,000 to invest and have looked at the main high street offers. The Abbey has a "Super Bond" paying 5.5% on a 50/50 split deposit. Half the money would be invested in a one year fixed rate account and the other can be "gambled" on either the FTSE 100 or house prices going up. This would be locked in for 3yrs 9mths. The FTSE 100 would need to be up on it's starting value by an average of 1 point over the last 3 months before the term ends to pay a full 5.5% on the second half of the money, with a minimum guaranteed 0.25% if it is less than 1 point up. I think this sounds OK but is there a better rate to be had without risking ALL of the investment?
Advise would be gratefully received, thanks

ses6jwg

And are you happy with them gambling your money?
Personally I would steer clear, if you want some exposure to the markets I'd do some research and go for a self select ISA from a fund supermarket. 100s of funds to choose from.

Investments from high street banks are typically not good performers.

Aegis

The Santander 50/50 products tend to be awful. I've not seen the terms of their new one through Abbey, but I'd be willing to bet that it isn't really worth it.

Baldur

Abbey's usual ploy of linking a savings product at a good interest rate with one of their dire investment products - wouldn't touch it with your bargepole, let alone mine.

portlandboy

ses6jwg wrote: »

And are you happy with them gambling your money?
Personally I would steer clear, if you want some exposure to the markets I'd do some research and go for a self select ISA from a fund supermarket. 100s of funds to choose from.

Investments from high street banks are typically not good performers.

That helps thanks. Can I open a self select ISA even though I have an ISA at the moment or are all ISAs the same, ie only one at a time? My current ISA isn't giving any real return (about 0.5%) so I could close it if this was required.

portlandboy

Aegis wrote: »

The Santander 50/50 products tend to be awful. I've not seen the terms of their new one through Abbey, but I'd be willing to bet that it isn't really worth it.

Thanks, glad I asked!

portlandboy

Baldur wrote: »

Abbey's usual ploy of linking a savings product at a good interest rate with one of their dire investment products - wouldn't touch it with your bargepole, let alone mine.

Thanks also, Really glad I asked now!!

Baldur

portlandboy wrote: »

That helps thanks. Can I open a self select ISA even though I have an ISA at the moment or are all ISAs the same, ie only one at a time? My current ISA isn't giving any real return (about 0.5%) so I could close it if this was required.

You are currently allowed £7,200 per tax year ISA allowance - the full amount can be paid into a Stocks & Shares ISA or up to £3,600 can be paid into a Cash ISA and the balance paid into a Stocks & Shares ISA.

i.e. You can have one of each type of ISA each tax year up to the above limits.

opinions4u

portlandboy wrote: »

I have about £12,000 to invest and have looked at the main high street offers. The Abbey has a "Super Bond" paying 5.5% on a 50/50 split deposit. Half the money would be invested in a one year fixed rate account and the other can be "gambled" on either the FTSE 100 or house prices going up. This would be locked in for 3yrs 9mths. The FTSE 100 would need to be up on it's starting value by an average of 1 point over the last 3 months before the term ends to pay a full 5.5% on the second half of the money, with a minimum guaranteed 0.25% if it is less than 1 point up. I think this sounds OK but is there a better rate to be had without risking ALL of the investment?
Advise would be gratefully received, thanks

1) Don't touch it with a bargepole.

2) If you want a savings/investment mix that protects capital then why not stick £11k in a 3 year fixed account (at 4.5%) and then put the other £1k in to an all-shares tracker fund with somebody like L&G - perhaps in a stocks and shares ISA wrapper? You're certain to have more than £12k at the end of 3 years.

My current ISA isn't giving any real return (about 0.5%) so I could close it if this was required

Keep it and transfer it to a new provider who will pay you a higher rate on it. Or ask your existing provider what other options they have for it (e.g. a fixed rate ISA at 3.5% - 4.5%).

ses6jwg

Yeah as said above really.

Transfer your current ISA into something better. Should be looking at around 3-4% interest really.

Then you've got another £3,600 to put into a stocks and shares ISA.