ILGs held to maturity

Veloflyer

To hopefully assuage my fears - am I right in thinking that even if there was a collapse of the bond market and providing ILGs are held until maturity, all other things being equal, it would not affect the redemption value on maturity?

I note yields seem to be rising and various articles on declining investor confidence in HMG, which make me somewhat twitchy…..

OldScientist

If you mean by 'a collapse' that yields increase and prices decrease, then you are correct, an ILG will mature at 100 in real terms (the nominal value at maturity is unknown since future inflation is unknown).

If you mean by 'a collapse' that the UK defaults on its debt, then, unfortunately, the bonds will then be worthless. This is unlikely, but not impossible.

Veloflyer

https://forums.moneysavingexpert.com/discussion/comment/81961392#Comment_81961392

Many thanks. I do mean the former para. Agreed to the latter, but I am increasingly concerned. I ought not to be perhaps, but I am.