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Safe Inverstment with guaranteed return

I have a friend who has about £70,000 to invest in a safe return savings account or bonds. She would like to be able to withdraw funds once or twice a year. What products would be worth considering at the moment. The person is a basic rate tax payer.

Comments

  • dunstonh
    dunstonh Posts: 118,602 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Products to consider are deposit based accounts, ISA & OEIC/UT, life bonds, some guaranteed stockmarket bonds (although many dont allow withdrawals, some do), fixed term deposits with an annual withdrawal allowance.

    It may be that a combination of things could be considered to achieve the different goals (one to grow and one to provide the income withdrawal) which would include stakeholder pension, immediate vesting pension or annuity.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • deemy2004
    deemy2004 Posts: 6,201 Forumite
    First stop cash isa
    Then shares isa (note can include gov bonds so basically a fixed interest bond)

    Thats 6k

    Then there are the high paying monthlies
    halifax , derbyshire, abbey
    So you need to feed the accounts monthly - total would be 21k

    The rest -
    Put 13k in an instant access high int account so its on call. th
    Put 30k in a fixed interest 2 year bond - Its a bit late, but you can still get 5.65% fixed Scottish london bank.
  • It is not Christmas yet but Deemy is talking turkey here.
    ...............................I have put my clock back....... Kcolc ym
  • dunstonh
    dunstonh Posts: 118,602 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    deemy thinks cash ISAs are the answer to everything so you have to ignore him a bit i'm afraid.

    If you were to follow his posts, which have actually got to the point of breaking the law now, you could eliminate other options which may be more suitable.  

    In reality, there isnt enough information here to suggest any products.  Just a range of areas that can be investigated.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  •  
    In reality, there isnt enough information here to suggest any products.  Just a range of areas that can be investigated.

    Exactly. That is why I left it to braver man than I to post the first answer. ;);)
    ...............................I have put my clock back....... Kcolc ym
  • brodev
    brodev Posts: 1,018 Forumite
    Withyour name i would suggest investing it all with Ladbrooks on Glasgow Celtic winning the league.
    ;D ;D ;D ;D ;D ;D ;D ;D ;D ;D ;D ;D ;D ;D ;D
    Something Really Interesting
  • It depends on how much your friend wants to withdraw but if she's be happy with a regular income then I'd suggest a fixed term fixed rate savings account with monthly interest payments. She could also consider various National Savings accounts. The interest rates aren't the best, but they aren't bad

    http://www.nsandi.com/interest-rates/index.jsp

    and they are certainly safe .

    However, inflation will gnaw away steadily at that £70,000; at 3% inflation, it will be worth only £51,000 in ten years, so really just putting the money in a savings account isn't enough, unless she draws only a small percentage of the return. Alternatively, she could consider the NS&I inflation-linked savings certs for at least some of the money.

    http://www.nsandi.com/products/ilsc/index.jsp?section=details

    HTH

    Cheerfulcat
  • At some point in the seventies I think inflation approached 30% p.a.

    I thought hey it would be great to have a large debt ( say 3 years salary ) and have it depreciate rapidly.
    So I moved to a bigger house  ...  It cost an additional £17000 over and above what I got by selling my existing house.  That was all some time ago.
    Since then the house I bought has appreciated by £250,000 more than my original house has appreciated.
    I was easily able to cope with the increased mortgage at the time ( SVR 15% but my mortgage rate for High Amount Loaned was 16% ) because my Salary kept pace with inflation.
    I think that one year I had at least seven rises made up of an annual rise, a promotional rise, and a rise every time the inflation for the ongoing year increased by a further 1% more than 7% pa.

    iu.e.  Our cost of living rise was 7% but when the cost of living during that financial year hit 8% we got another 1% rise.  So we got a rise almost every month.
    ...............................I have put my clock back....... Kcolc ym
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