What should I do with £41,000

Susan1942

I have got a bond with Phoenix Life which is performing miserably. My plan is to cash it in and looking for advice on what I should do with it.  I don't need access to it.  I thought I might put £20,000 in a Cash Isa but not sure what I should do with the remainder.  I would appreciate suggestions.  Many thanks  Sue 

Peter999_2

If it were me I would open a Zopa Buscuit current account with the rest of the £20,000 as they are offering 4.75% at the moment (you have to put £500 a month into it to get that rate - but you can simply move £500 from it to another bank and back again in minutes and you'd qualify).

eskbanker

You'd need to consider when you'd need access to the money but might benefit from following the structured approach of this flowchart:

The Flowchart - UKPersonalFinance Wiki

Susan1942

Thank you for your responses. I will not need this money in the near future.  I don't have a mortgage or any debt.  I have enough income to meet my need and I have other investments.  I have got £29,500 in my current accou]nt.  Too much in fact but I do get interest up to £25,000 going down to 2.1% in December. Has been 2.5%/
I am not happy opening accounts with banks I am not familiar with.

Susan1942

Thank you for your suggestion.  I  had a look at the Flowchart.  I would not be happy doing this.  I like to be able to decide what I want to spend or what I might give to members of my family particularly grandchildren.  I am not taking expensive holiday any longer. My home has been upgraded and I have replaced a lot of my furniture 3 years ago.

eskbanker

Susan1942 said:

I will not need this money in the near future.

Typical rules of thumb on here would be to keep money in savings if needed within, say, 5-10 years, or pensions if not needed until after retirement, and (standalone) investments for anything in between, but if your username signifies your year of birth then do you anticipate ever needing the money?  Do you want it to go to family when you die, or might you need it for care, or would it be better spent on some luxuries, etc?

Susan1942 said:

Thank you for your suggestion.  I  had a look at the Flowchart.  I would not be happy doing this.

Doing what?

dunstonh

I have got a bond with Phoenix Life which is performing miserably.

The bond won't be performing.  The investments within it perform, and there will be a choice of investments.  So, one option is to look at the investments and select what is appropriate.

Seeing as how the stock market has boomed, t is likely that you are heavy in gilts and fixed interest.   That went through its worst period in over 100 years until late 2023.  However, they have been doing better of late.   

Susan1942

Thanks for that.  The return is only  £87 in the past 12 months to 22nd October.  I do know that they say there are other funds which I could switch to but I have lost confidence in them.  
I bank with Santander and they are paying 4% in a cash Isa currently. 

friolento

Peter999_2 said:

If it were me I would open a Zopa Buscuit current account with the rest of the £20,000 as they are offering 4.75% at the moment (you have to put £500 a month into it to get that rate - but you can simply move £500 from it to another bank and back again in minutes and you'd qualify).

I believe that 4.75% is no longer on offer to new applications.

friolento

Whilst you decide what to do with your money, you could uut £50k into Premium Bonds, and/or £20K into an ISA, unless you have these already.

Keeping much money in a 2.5/2.1% current account is not MSE. Even the NS&I Direct Saver with its painfully low interest rate pays better. As do a whole host of other accounts  

Kim_13

friolento said:

Whilst you decide what to do with your money, you could uut £50k into Premium Bonds, and/or £20K into an ISA, unless you have these already.

Keeping much money in a 2.5/2.1% current account is not MSE. Even the NS&I Direct Saver with its painfully low interest rate pays better. As do a whole host of other accounts  

Yes, both of these could be done when considering the current account balance also. You could look for a flexible ISA for part of the current account balance, so that you are able to withdraw from it if required and replace it within the same tax year without it counting toward your allowance. HMRC rules now allow multiple cash ISAs per tax year, so the £20,000 can be split between a flexible easy access ISA and a fixed rate ISA if you wish.

Premium Bonds would not be the first choice of everyone on here, but NS&I meet the criteria of a recognised name.