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Investment Planning

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  • 7685
    7685 Posts: 35
    10 Posts First Anniversary Name Dropper
    Forumite

    I have budgeted for £25,000+ £5,000 emergency fund per year for ten years, any left over at the end of the year will be invested) .

    I will put two years money (£60,000) into an easy access and a savings account and move the money over to these accounts and put the rest in ILG? GIlts? or MMF? any other options, welcome.

  • InvesterJones
    InvesterJones Posts: 1,890
    1,000 Posts Fourth Anniversary Name Dropper
    Forumite

    This is for the 2-10yrs emergency/living fund right? So I guess the main consideration is inflation matching at low risk. An ILG ladder I think is positive real yield for all years at the moment, so seems like the obvious one if you don't need more growth. You might get some more bang for your buck if you use fixed savings rate products (depending on tax situation) or conventional gilts for the earlier years, but you lose the hedge against higher than expected inflation. MMF on the other hand are a hedge against interest rate increases, but if you're building a ladder and using maturing bonds for income then you don't care about interest rate increases.

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