Investment

RG2015

Kim18035 wrote: »

Well , I meant all ways of investements to generate from my cash more money and not only saving accounts .

My recommendation is the NS&I 3 year bond at 2.20% per annum. The only caveat is that it may increase later this year if the Bank of England raise the base rate. The only risk is that it probably won't keep pace with inflation.

Kim18035

I can't accept any lose after 5 yeras so bonds maybe an option to consider . Can I buy them and keep for three years if in the meantime I may relocate outside of the UK ? Where to find out more about bonds?

xylophone

I am on pensioner already

How old are you?

Are you yet in receipt of state pension?

rathernot

I'd look at NS&I offerings. Fully government backed plus you can withdraw early from most of them with an interest penalty.

Kim18035

I am not I receipt of a state pension. Will the expected Feb increase in bank interest affect bonds interest ? Should I want until end of Feb to see if they offer better interest on bonds ?

RG2015

Kim18035 wrote: »

I can't accept any lose after 5 yeras so bonds maybe an option to consider . Can I buy them and keep for three years if in the meantime I may relocate outside of the UK ? Where to find out more about bonds?

The link below gives you details of all NS&I products including their bonds. Just click on Our Products.

https://www.nsandi.com/

Kim18035

I have looked at what they offer and consider Guaranteed Growth Bonds for 3 years at 2.2 % per annum .But as already mentioned, will the expected Feb increase in bank interest affect bonds interest ? Should I wait until end of Feb to see if they offer better interest on bonds ?

RG2015

Kim18035 wrote: »

I have looked at what they offer and consider Guaranteed Growth Bonds for 3 years at 2.2 % per annum .But as already mentioned, will the expected Feb increase in bank interest affect bonds interest ? Should I wait until end of Feb to see if they offer better interest on bonds ?

I have a very special crystal ball which has given me the answer to your question but I am not allowed to share this information.

Kim18035

I really like your answer so in other words if you were me would you wait ? Or would you rather buy one year bonds just now and then consider a longer ones to get a better deal ?

RG2015

Kim18035 wrote: »

I really like you answer so in other words if you were me would you wait ? Or would you rather buy one year bonds just now and then consider a longer ones to get a better deal ?

I wouldn't get the one year bond.

The one year bond is 1.50% but if you get the 3 year bond and withdraw after one year the penalty is 90 days which is equivalent to 0.55%. This would leave you with a net figure of 1.65% which is better than 1.50%.

Will the bank rate go up? Will NS&I increase their rates as a result? Will NS&I withdraw the product? All of these are are a yes or a no in the next 6 months.

Then we need to consider inflation and whether this will increase or decrease. And dare I mention Brexit creating more uncertainty than anything else since it has never happened before.

PS: Also bear in mind that the 90 day penalty may affect your tax liability as it probably cannot be offset against the full interest earned. Also, if you withdrew before 90 days you would lose some capital to pay the penalty. In practice I doubt that anyone would do this other than in an emergency.