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Large lump sum investment - What would you do?

Se99paj
Posts: 37 Forumite

Hello, I'm about to sell a property and will temporarily have a large lump sum available, this will be temporary as I'd be looking to use this as a deposit within the next 12 months, I'd estimate it will be £100k+
Where would you put this cash in the short term, to ensure it beats inflation? Investing in S&S in the short term would be quite risky, but interest in savings accounts barely beats inflation.
Where would you put this cash in the short term, to ensure it beats inflation? Investing in S&S in the short term would be quite risky, but interest in savings accounts barely beats inflation.
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Comments
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Many posters ask the same question ' I want to match/beat inflation with no risk '
The answer is to beat inflation you need to take investment risk . There can be short periods when savings interest rates are above inflation ( especially if you have a long term fix or a regular saver) but for this amount of money at the money at the moment you have the following choices:
NS & I - Income bonds: direct saver ; premium bonds
Bank/building society - easy access account for up to £85K per institution
Investing in S& S for only 12 months is a no .
https://moneyfacts.co.uk/savings-accounts/easy-access-savings-accounts/
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I'd put it in savings accounts. I wouldn't be worried about inflation for those timeframes.
No one has ever become poor by giving0 -
Se99paj said:Hello, I'm about to sell a property and will temporarily have a large lump sum available, this will be temporary as I'd be looking to use this as a deposit within the next 12 months, I'd estimate it will be £100k+
Where would you put this cash in the short term, to ensure it beats inflation? Investing in S&S in the short term would be quite risky, but interest in savings accounts barely beats inflation.
If not - you for the best easy access/fixed rate/notice savings accounts and/or premium bonds.0 -
NS&I Income Bonds?
Premium Bonds in the hope of the big win?0 -
NS&I is the best option for you as the temporary protection from the FSCS for balances over £85K only lasts for 6 months. You could split the amount between two banks, but this would be unnecessary if you use NS&I.
S&S ISA is a no-no, you are as likely to lose money as gain it over that short a period.The comments I post are my personal opinion. While I try to check everything is correct before posting, I can and do make mistakes, so always try to check official information sources before relying on my posts.0 -
It would be handy if MSE had a bot algorithm installed that automatically said "NS&I" when such threads appear.
Honest Se99paj, that's best advice from everyone. Only viable alternative is cash under the mattress..._
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tacpot12 said:NS&I is the best option for you as the temporary protection from the FSCS for balances over £85K only lasts for 6 months. You could split the amount between two banks, but this would be unnecessary if you use NS&I.
S&S ISA is a no-no, you are as likely to lose money as gain it over that short a period.
https://www.fscs.org.uk/how-we-work/temporary-high-balances/
https://www.fscs.org.uk/media/press/2020/aug/thb-coverage-extended/
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Se99paj said:but interest in savings accounts barely beats inflation.0
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Savings account or premium bonds. You don't really have any other alternative without putting your capital at risk. Given you're only thinking about sitting on this for 12 months, the opportunity cost is quite low with inflation being low, so I wouldn't worry too much about 'losing out', especially if you're buying a new home with the money as I suspect house prices will be at a similar price or cheaper than they are currently, once furlough schemes are ended and money creation is eased.
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