Pension Lump Sum - Best options

kassy64

EthicsGradient said:

I think a bit of confusion may have occurred because your first post seemed to emphasise monthly income for the next year - which many thought was the primary purpose. If, as it seems from your later posts, it's more like "I'll put up to £85k in savings for this year, but might use a significant part of it in the next years, and if I'm getting interest, I may as well get it now than wait for a year", then doing that through the lump sum does make sense.

If you want a "name" for security, and the requirement for the interest to be paid monthly isn't vital, perhaps Investec could be worth a look. They have a 90 day notice account paying 2.1% (that more or less matches the best notice account from anyone), and a 1 year fixed rate bond at 2.55% - which some smaller providers can beat (OakNorth at 2.85%). Investec is a FTSE 250 company (it's about the 125th largest company on the LSE - market capitalisation about £3 billion, slight larger than, say, ITV or Marks & Spencer), so that might be reassuring. But neither account offers monthly interest.

Having said that, the Bank of England is making another base interest rate decision tomorrow, and there's speculation on whether that will be a 0.25% or 0.5% rise. Depending on which happens, banks may revise their offered rates again in the next week or two, so any specific recommendation to you now may be out-of-date by the time your lump sum is available. I'm sure this forum will have discussion on the movements.

Thanks for the above info, I will have a look
As for being rude (few posts back) take a look at the first few lines of the 1st reply - got off on the wrong foot obviously never had an autocorrect when posting. 

Expotter

I don't know the details of your specific plan, but in my case, the spouse's pension after death is identical whether I take the lump sum or not. So were I to die earlier than planned, any potential gains from having a higher pension would be lost anyway. At least with the lump sum I could pass it on as inheritance. So, as long as your planned income is enough for your needs, I would also take a lump sum, but I do have to admit though, that this ridiculously high inflation has thrown a spanner in the works, but you'll always have to deal with uncertainty one way or another.
 As far as savings, I wouldn't commit to a fix just yet because rates are still going up. Maybe just 90 days notice accounts for the time being, looking to fix for longer by the end of the year.

dunstonh

kassy64 said:

EthicsGradient said:

I think a bit of confusion may have occurred because your first post seemed to emphasise monthly income for the next year - which many thought was the primary purpose. If, as it seems from your later posts, it's more like "I'll put up to £85k in savings for this year, but might use a significant part of it in the next years, and if I'm getting interest, I may as well get it now than wait for a year", then doing that through the lump sum does make sense.

If you want a "name" for security, and the requirement for the interest to be paid monthly isn't vital, perhaps Investec could be worth a look. They have a 90 day notice account paying 2.1% (that more or less matches the best notice account from anyone), and a 1 year fixed rate bond at 2.55% - which some smaller providers can beat (OakNorth at 2.85%). Investec is a FTSE 250 company (it's about the 125th largest company on the LSE - market capitalisation about £3 billion, slight larger than, say, ITV or Marks & Spencer), so that might be reassuring. But neither account offers monthly interest.

Having said that, the Bank of England is making another base interest rate decision tomorrow, and there's speculation on whether that will be a 0.25% or 0.5% rise. Depending on which happens, banks may revise their offered rates again in the next week or two, so any specific recommendation to you now may be out-of-date by the time your lump sum is available. I'm sure this forum will have discussion on the movements.

Thanks for the above info, I will have a look
As for being rude (few posts back) take a look at the first few lines of the 1st reply - got off on the wrong foot obviously never had an autocorrect when posting. 

You may not be aware of this but the smiley face that follows a comment is to indicate that it is joking.   What exactly is rude about the first post as I cannot see anything that is.

CheekyMikey

Take the lump sum, get the best interest you can and don’t worry about what is happening in the world for the next few years…price rises won’t give you sleepless nights. Sounds like your income will be fine in 6 or 7 years time anyway, and you’ve got the house equity as back up. With a nice cash war chest, you won’t need to sell depressed investments in the current bear market. It’s what I’ve done and I still think it was absolutely the correct decision.