What to do with 42k

foxybabe

Hi, I am a bit of a lurker on here but would appreciate some advice please. I have 42k which I inherited several years ago. I have kept it in fixed-interest accounts till now and moved it around to get the best interest possible. However, the best I can get at the moment is 0.40% tied up till March 2022. I don't really want to risk it or tie it up for a long time so am wondering what to do with it to get the best return. I have thought about buying premium bonds with it? Thank you in advance.  

Thrugelmir

Any debts to repay? 

Aceace

foxybabe said:

Hi, I am a bit of a lurker on here but would appreciate some advice please. I have 42k which I inherited several years ago. I have kept it in fixed-interest accounts till now and moved it around to get the best interest possible. However, the best I can get at the moment is 0.40% tied up till March 2022. I don't really want to risk it or tie it up for a long time so am wondering what to do with it to get the best return. I have thought about buying premium bonds with it? Thank you in advance.  

Yes, if you're not willing to accept some level of risk to your capital then PBs are about the best you can do at the moment. On average luck you would get about 0.9%, plus a small chance of winning a big prize. Although you will have easy access to the cash it's not worth putting in PBs for a short time as bonds don't go into the draw for at least a clear calendar month after purchase.

steampowered

What is your retirement savings situation - have you set yourself up with an adequate pension for retirement? If not, putting money into a pension could be a very productive use for this money. Plus pensions benefit from tax relief (aka a free top-up from the government).

foxybabe

Thrugelmir said:

Any debts to repay? 

No debts, we have pensions sorted and already have a few premium bonds but as yet no wins.  

couriervanman

foxybabe said:

Thrugelmir said:

Any debts to repay? 

No debts, we have pensions sorted and already have a few premium bonds but as yet no wins.  

If your few premium bonds are in small amounts cash them in and buy a new batch in one go with the £42k

grumiofoundation

couriervanman said:

foxybabe said:

Thrugelmir said:

Any debts to repay? 

No debts, we have pensions sorted and already have a few premium bonds but as yet no wins.  

If your few premium bonds are in small amounts cash them in and buy a new batch in one go with the £42k

Why would you need to cash them in?  

couriervanman

grumiofoundation said:

couriervanman said:

foxybabe said:

Thrugelmir said:

Any debts to repay? 

No debts, we have pensions sorted and already have a few premium bonds but as yet no wins.  

If your few premium bonds are in small amounts cash them in and buy a new batch in one go with the £42k

Why would you need to cash them in?  

If you had for example £2000 bought over a few years in £25 batches you are never going to win anything......far better to have consecutive numbers

grumiofoundation

couriervanman said:

grumiofoundation said:

couriervanman said:

foxybabe said:

Thrugelmir said:

Any debts to repay? 

No debts, we have pensions sorted and already have a few premium bonds but as yet no wins.  

If your few premium bonds are in small amounts cash them in and buy a new batch in one go with the £42k

Why would you need to cash them in?  

If you had for example £2000 bought over a few years in £25 batches you are never going to win anything......far better to have consecutive numbers

I expected that’s would be the ‘reason’ but that’s not how premium bonds work.

All you are doing by selling and re-buying is missing out on a draw. 

ultrasilvam

couriervanman said:

If you had for example £2000 bought over a few years in £25 batches you are never going to win anything...... far better to have consecutive numbers

Why would that be the case? Each bond has the same chance to be drawn. Why would consecutive numbers be better? 

Hexane

If tying up some of the money for one year would be acceptable, then getting some of it into Regular Savers would seem worthwhile. Currently offering as much as 1.75% although more commonly around 1.3%

These also often have the advantage that they retain the higher rates of interest even after other interest rates drop even further (for example I still have several paying 2.75% at present).