mark3536 said:
Hello to all on this frosty night!!
I have some money to invest, £57000 due to AFCS payment. I have spoken to afew advisors who have suggested Premium Bonds, ISA and a 5 year savings bond.
What im really after is a monthly income from the lump sum in a low risk fund. When i asked the said advisors they were not too sure about it. I was just wandering if there is anyone on here who is fairly clued up.
Regards.
Make out the cheque to me or, better still, make out the cheque to my company called, for short, C.A.S.H.
Send it to me and I will do my best to give you a monthly income. And I guarantee that I will do my best - and I will send you regular updates from my office in the Bahamas!
Looking forward to receiving your cash, er, investment...
Litotes
OK, that was the laugh and a demonstration of how careful you should be!! I will try to keep things simple but if you want to self-help you must spend some time researching the market:
1. Clear your debts except for a mortgage or a debt where you have already paid the interest.
2. Premium Bonds. My long-term return is 3.25%pa. My return since they chopped the prizes last year is just 0.6%pa. You could win the £1m prize - but, most likely, you will win nothing or £25. Not much of a return!
3. Bldg Socs/Banks. Watch the £50k protection limit. Were you to stick your £50k into
www.firstsave.co.uk you would currently receive 3.25%pa gross paid monthly. The Investec Bank improves on that with 3.32%. Both are 90 day notice accounts. You will be hard pressed to better those rates.
4. Some banks are offering current/regular savings accounts with good rates. They need management because if you go over £2000, for example, the rate drops from 5% to 0.1%! Look at
www.moneysavingexpert.com or
www.moneyfacts.com.
5. ISA. The best cash ISA I can find is offered by Abbey at 3.5% fixed for 2 years. I cannot remember the rules for cash ISAs.
6. Savings Bonds. My alarms start ringing because these are sold to people who haven't researched the market. However, I note that NS&I offers a bond with a gross monthly payment of 2.02%.
You need to research the market and keep an eye on your savings.
You also need to be aware that all of the above rates are variable and could vanish tomorrow. They also do not protect against inflation.
Companies such as Fidelity offer unit trusts that invest in money markets in order to offer a higher return (around 5% IIRC). Stick to the big companies and you should be OK BUT you might still lose some of your money if the company gets it wrong! You could invest via companies like Hargreaves-Lansdowne which will rebate their commission.
Litotes
