What's your creative/efficient (bond) laddering strategy

brucefan_2

My laddering strategy is straightforward and quite simplistic. I am retired and have a DB and Stae Pension. House paid for. No foreseen major purchases imminent.

I have 12 x 1-year fixed rate 'bonds' - one maturing each month. 

When each matures, I re-allocate to a new 1-year fixed adding a set amount each month that I have determined at the beginning of the year.

I value the re-assurance this brings of knowing that I each month I have almost immediate and then short to mid-term access to funds.

But  ...  I'm not creative enough to visualise alternative approaches (that obviously will suit different contexts accordingly) using the wide range of RS, notice and fixed accounts that are on the market.

So, without giving exact details away, how do you approach laddering to maximise your returns and/or peace of mind?

Are there any strategies you've tried which didn't work?

TIA

bostonerimus

I'd extend the term of your bonds to get better interest rates and have one mature each year. Eventually you'll have a ladder of say 5 bonds all with 5 year terms, if you can get longer terms and higher rates then all the better.

RG2015

I look to the rates as well as the type of account. I have a mixture of one year and RS accounts in my ladder which is at least monthly maturity and sometimes fortnightly for at least one year.

The First Direct regular saver at 7% is a no brainer yielding up to £3,737 after one year.

One year fixes are now approaching 5.00% which is fine but still beaten or matched by other regular savers.

Club Lloyds 6.25%
BOS 5.50%
Halifax 5.50%
Lloyds 5.25%
HSBC 5.00%
TSB 5.00%

Some of these allow withdrawals so that possibly trumps one year fixed savers.

NatWest/RBS Digital Regular savers offer 6.17% but on a lower monthly maximum deposit of £150. These though are also no brainers but there is a strong incentive never to withdraw. Hence cannot really be part of a ladder.

thefrank

FD, Lloyds and RBS savers all open, starting to choose long fixed Bond, one per year, I have a 3 and a 5 year as well and on the verge to chose another 5 years because I do think rates are set to be lower in the near future. I prefer Zopa and Coventry to 'childish' companies who raise 1 p at the time just to top the table: I prefer to earn a little bit less but sleep well at night, and although all these banks with strange names are protecting my savings am not for exotic choices :-) There is no strategy: it all comes down to your personal circumstances, but do keep in mind security is worth a couple of pennies less in interests

masonic

I just put 4 months living costs into a ladder spaced 4 months apart. Having one mature 3 times per year seems like a good compromise for me - I wouldn't want to have to deal with a maturing account every month. However, I'm not retired and use regular savers to fund my S&S ISA and extra pension contributions.

Middle_of_the_Road

francoghezzi said:

I prefer Zopa and Coventry to 'childish' companies who raise 1 p at the time just to top the table: I prefer to earn a little bit less but sleep well at night, and although all these banks with strange names are protecting my savings am not for exotic choices :-) There is no strategy: it all comes down to your personal circumstances, but do keep in mind security is worth a couple of pennies less in interests

I thought Zopa was a strange name for a bank, but probably not.

Zone Of Possible Agreement (ZOPA): Definition in Negotiating (investopedia.com)

A ZOPA can only exist if there is some overlap between what all parties are willing to accept from a deal

masonic

Middle_of_the_Road said:

francoghezzi said:

I prefer Zopa and Coventry to 'childish' companies who raise 1 p at the time just to top the table: I prefer to earn a little bit less but sleep well at night, and although all these banks with strange names are protecting my savings am not for exotic choices :-) There is no strategy: it all comes down to your personal circumstances, but do keep in mind security is worth a couple of pennies less in interests

I thought Zopa was a strange name for a bank, but probably not.

Zone Of Possible Agreement (ZOPA): Definition in Negotiating (investopedia.com)

A ZOPA can only exist if there is some overlap between what all parties are willing to accept from a deal

It used to be a peer to peer lending platform.

Middle_of_the_Road

masonic said:

Middle_of_the_Road said:

francoghezzi said:

I prefer Zopa and Coventry to 'childish' companies who raise 1 p at the time just to top the table: I prefer to earn a little bit less but sleep well at night, and although all these banks with strange names are protecting my savings am not for exotic choices :-) There is no strategy: it all comes down to your personal circumstances, but do keep in mind security is worth a couple of pennies less in interests

I thought Zopa was a strange name for a bank, but probably not.

Zone Of Possible Agreement (ZOPA): Definition in Negotiating (investopedia.com)

A ZOPA can only exist if there is some overlap between what all parties are willing to accept from a deal

It used to be a peer to peer lending platform.

Thanks, that does makes sense.

badger09

masonic said:

Middle_of_the_Road said:

francoghezzi said:

I prefer Zopa and Coventry to 'childish' companies who raise 1 p at the time just to top the table: I prefer to earn a little bit less but sleep well at night, and although all these banks with strange names are protecting my savings am not for exotic choices :-) There is no strategy: it all comes down to your personal circumstances, but do keep in mind security is worth a couple of pennies less in interests

I thought Zopa was a strange name for a bank, but probably not.

Zone Of Possible Agreement (ZOPA): Definition in Negotiating (investopedia.com)

A ZOPA can only exist if there is some overlap between what all parties are willing to accept from a deal

It used to be a peer to peer lending platform.

ZOPA was one of the first, and probably one of the most successful P2P platforms.
I was an early adopter in 2006, attracted by their ethos of ‘disrupting mainstream banking’ by facilitating loans between individual lenders & individual borrowers. It started off so small that members were regularly invited to meet the founders, and one of my borrowers was a very well respected poster on these fora. 

I stopped lending before it slowly morphed into a bank😏

valiant24

brucefan_2 said:

My laddering strategy is straightforward and quite simplistic. I am retired and have a DB and Stae Pension. House paid for. No foreseen major purchases imminent.

I have 12 x 1-year fixed rate 'bonds' - one maturing each month. 

Do you buy them directly from the UK Gilts Office?

brucefan_2

valiant24 said:

brucefan_2 said:

My laddering strategy is straightforward and quite simplistic. I am retired and have a DB and Stae Pension. House paid for. No foreseen major purchases imminent.

I have 12 x 1-year fixed rate 'bonds' - one maturing each month. 

Do you buy them directly from the UK Gilts Office?

It was perhaps not the best use of the word 'bonds' on my part - I basically mean 12 month fixed-rate accounts with various providers, depending on the best rate at the time.

Some institutuions label these accounts as 'bonds'  though, which is why I loosely used the term