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Baby bond?
Chesterly_frank
Posts: 14 Forumite
Hi, just after a bit of advice!
So I’ve paid into a ‘baby bond’ plan with forester life since my daughter was a baby. I saved £10 a month for coming up 18 years. As her birthday is approaching, I looked into cashing it in. I found out it was due to mature in August (so after 18 years, rather than when she turns 18)
The minimum she is assured is £1900 (less than I paid in) if I cashed it in today it would be worth £2300 (small profit).
My dilemma is this; I am happy making a small profit, but if I leave it in a bonus is applied at the end of the term. In the meantime though (thinking about all the brexit hoo-ha) with it being invested in the stock market, is it sensible to get the money out while the amount is decent? Is it worth risking leaving it in another 6 months as she doesn’t need it now, in the hopes of a decent bonus? Any ideas? Thanks
So I’ve paid into a ‘baby bond’ plan with forester life since my daughter was a baby. I saved £10 a month for coming up 18 years. As her birthday is approaching, I looked into cashing it in. I found out it was due to mature in August (so after 18 years, rather than when she turns 18)
The minimum she is assured is £1900 (less than I paid in) if I cashed it in today it would be worth £2300 (small profit).
My dilemma is this; I am happy making a small profit, but if I leave it in a bonus is applied at the end of the term. In the meantime though (thinking about all the brexit hoo-ha) with it being invested in the stock market, is it sensible to get the money out while the amount is decent? Is it worth risking leaving it in another 6 months as she doesn’t need it now, in the hopes of a decent bonus? Any ideas? Thanks
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Comments
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Not sure about the figures - £10 a month for 18 years is £2160. If the money was invested in the stock market is should have grown - how much will the bonus be? Is the amount liked to the FTSE?0
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An end value of £2300 for a series of £10/month payments over 18 years equates to 1% a year approx. compounded over 18 years. Hopefully the bonus will increase that substantially.0
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Forget Brexit. If the moneys been invested properly that will make at worse no difference and at best a positive difference. Hopefully the bonus will be good because at present the return is abysmal. Hang on til you get it.
. Let us know what it works out as eventually.0 -
Really appreciate the advice, maybe it’ll be worth hanging on to so I can get the most out of it for her.
It’s not a great return at all, but at least it was safe and I wasn’t able to dip into over these years! Have had one for all 4 of the children and have all been quoted very different expected values0 -
Yes I would definitely hanging there for the bonus no idea how much the bonus will be of course but it will hopefully increase your rate of return above the 1% let us know how it goes0
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