£36k to invest....Help!!

si_p

Hello all,

I'm looking for a little help on behalf of my parents - they have a fixed term account finishing in a month or so - their current bank, Halifax, have offered a new fixed term at 2.35%, as after tax thats going to be even lower surely, over 5 years.

Personally I think this is a little low, I know rates have dropped in the current financial climate, but surely there is something better than this?

They don't want to risk it, so peer-to-peer, or similar, is out, it has to be locked away for their peace of mind.
Does anyone have any good recommendations as to what is a good product for £36,000 to be saved in at the moment?

All help really appreciated,

Regards,
Simon

gadgetmind

If they are only prepared to take zero risk with this part of their overall investment portfolio, then they'll have to accept close to zero return.

Hopefully their other investments will make up for the low return on their cash allocation.

Archi_Bald

A couple of 123s would pay near enough 3% AER before tax, and same for Lloyds/BOS Vantages, and there are the FlexDirects @ 5% AER. There are ISAs (cash and S&S), there are Reg Savers.....but we don't have much information to go by on what their needs and wants are.

For example, we know nothing about the tax status of the parents (e.g. what tax rate is each of them in?), whether they have any debt/mortgage, what their plans are for the money, whether they have a rainy day fund, or what they mean by "it has to be locked away for their peace of mind". It's therefore completely impossible to recommend anything really.

calypso_rhapsody

Are they of an age when 5 year fixed term makes sense for them? Eg might they need to call on it for healthcare or nursing home costs?

My immediate reaction is that they could get 3% in two Santander 1-2-3 accounts if they can cope with the complexity. Up to £20k at 3% - so would need two. But the rate is variable and could drop any time.

Ifts

si_p wrote: »

I know rates have dropped in the current financial climate, but surely there is something better than this?

Some more offerings here with rates slightly better than what the Halifax has offered you on their 5 year fix:

http://moneyfacts.co.uk/savings/fixed-rate-bonds/

atush

If they are only prepared to take zero risk with this part of their overall investment portfolio, then they'll have to accept close to zero return.

Perhaps you need to explain Risk to them, as they Clearly don't understand it. Cash has a GUARANTEED risk of inflation in that their money will be eroded each year. As nothing on the market beats inflation plus basic rate tax.

Investment risk is possible, but not guaranteed. So they'd be better off investing some of their cash. I made over 20% this year on my investments, and probably less than 2% on the cash overall. I could have lost 10%+ as well. but they'll be losing every year of that fixed rate bond if they take it out.

noelphobic

Interesting thread. I have a similar amount of savings but no other income whatsoever at the moment. Interest rates are dire but I can't afford to take risks with my money. Know next to nothing about S&S ISAs but am beginning to think I need to learn.

robtgossard

Commodities, especially precious metals, and real estate are good investments at this point in time. I’d suggest you stack up on some gold & silver bullion coins from a reputed wholesale gold dealer. It is easy to exchange precious metals coins for cash almost everywhere in the world. If you are not sure where to put your money, consult a finance pro.

kidmugsy

Leeds BS is offering a five year ISA at 3% p.a., or at 2.75% p.a. with one quarter of the cash available on instant access. The latter is interesting: look at it as offering 3% p.a. on the three-quarters and 2% p.a. on the one quarter. If they opened one each that's £11,520 taken care of.

Whether they'd really want to fix rates at the moment is a question for them.

helptoyou

If They are happy to tie funds up to get a decent rate (at the moment) but risk rates going up in the meantime Skipton Buildng society currently offer an online 7 year term bond offering 3.5 % issue is restricted to a max of 10k per person leaving 16k to be invested elsewhere.

Butterfliesarepretty

si_p wrote: »

Hello all,

I'm looking for a little help on behalf of my parents - they have a fixed term account finishing in a month or so - their current bank, Halifax, have offered a new fixed term at 2.35%, as after tax thats going to be even lower surely, over 5 years.

Personally I think this is a little low, I know rates have dropped in the current financial climate, but surely there is something better than this?

They don't want to risk it, so peer-to-peer, or similar, is out, it has to be locked away for their peace of mind.
Does anyone have any good recommendations as to what is a good product for £36,000 to be saved in at the moment?

All help really appreciated,

Regards,
Simon

Try Chase De Vere in London, my mum has investments with them left over from what my dad invested. They move the investments around when they think they are not doing well. she has made a fair amount of money last year.