Fixed Rate Online Bond

quequifa

My 3 year Post Office fixed rate bond matures in 60 days and I'm wondering where best to lodge the £50,000.00 deposit. At present it pays 4.13% gross/4.21% AER, but I don't expect that rate to be maintained.

As a pensioner, I need a regular monthly income to supplement my OAP. At the same time, I have a low opinion of banks and similar financial institutions. Accordingly, I save with building societies, the Post Office, N S & I. (I realise that money lodged there will find its way into private banks/financial institutions, but what can you do?)

Given my preferences, and with my ISA fully subscribed at the Skipton BS, can you recommend a suitable home for my cash?

Thank you.

colsten

You can spread £50,000 across a range of 3, 4 and 5% current account. See the list here, plus you can add 3 x BOS Vantage.

All UK regulated deposit takers are part of the FSCS scheme, so you money is safe up to £85,000 with any single financial institution. Dismissing some of them because they are banks is cutting your nose off to spite your face.

You realise that the Post Office banking services are provided by the Bank of Ireland, which used to operate without a UK banking licence? They do have one now, so you are as safe up to £85K with them as well.

Eco_Miser

The best accounts are those mentioned by colsten, which do pay monthly interest. However, there is another alternative: You put a year's worth of expected interest into a high interest account, and spend it over the year, and put the rest of your money in an account paying annual interest, which you put in the current account and spend next year; if you can find one paying better interest than the current accounts.

gt94sss2

You should also keep an eye out on the new NS&I Pensioner Bonds which were announced in the budget. Available from January 2015

Regards
Sunil

quequifa

Thank you to colsten, Eco Miser and gt94sss2 for their advice. As explained in my original post, I'm aware of where savings end up, including savings with the Post Office. I had also already accessed the, excellent, site suggested by colsten. As recommended by gt94sss2, I shall keep an eye on the NS&I Pensioner Bonds available shortly before the next General Election.

Thank you, again.

Archi_Bald

gt94sss2 wrote: »

You should also keep an eye out on the new NS&I Pensioner Bonds which were announced in the budget. Available from January 2015

Regards
Sunil

Keep your expectations realistic though - max will be £10K per person per bond, and there will only be £10bn worth of bonds available.

gt94sss2

Archi_Bald wrote: »

Keep your expectations realistic though - max will be £10K per person per bond, and there will only be £10bn worth of bonds available.

Yes - that's what the article I linked to said. However, the interest rate is likely to be higher than qualifying savers can get elsewhere (apart from 1/2 short term current account offers)

Regards
Sunil