7 year investment time frame

fluffpig

Does anyone have any words of wisdom on where you would accumulate money that you wanted to start drawing on in around 7 years time? Most advice seems to focus on either long term or short term and 7 years seems a bit 'in between'.

My personal view is that 7 years would probably be classed more as 'short term' but seems too long to be stuck in a savings account or money market fund if we enter a period of falling interest rates. Would a bond fund or 60/40 be the way to go or are bonds still a bad idea?

Just for context this would be money to bridge the gap to retirement. My SIPP is 100% global equities which I'm comfortable with at the moment as I won't start drawing on it for another 12 years but I don't really want to add to this with money I'll potentially need sooner

Grateful for any input!

masonic

If you don't need all of the money in one go (as seems the case) then a mixture of equities and bonds would be a suitable option. You may wish to keep these separate, as this would enable you to 'lifestyle' your portfolio as you go along. Bonds have taken their hit from rising interest rates, from here, it is likely interest rates will go down, so there may even be capital gains to look forward to. You could consider individual gilts maturing at relevant times to remove risk from your bond holdings.

Albermarle

You are right that it is a bit 'inbetween' 
Personally I would say with your SIPP at 100% equities, I would tend to play it relatively safe with a 7 year time frame, with a decent proportion of it in cash . This video could help.
Best Medium Term Investment Options (3 - 5 Years) - PensionCraft

ColdIron

Investment grade or corporate bonds may not be a bad idea now since the re-rating seen in 2022. They are more realistically priced now and with interest rates and inflation falling are better placed and more resilient to market shocks. A 60/40 fund might suit

Linton

If you plan to keep drawing down for all or most of your retirement the 7 years period only applies to say 3% of your money.  In that case I suggest you keep say 80% of the pot invested the same way it is now with a short duration bond fund for the rest.