[AndyMD]

Very quick question

Got a little to invest, but most ISA's etc paying under 1%, are Premium Bonds a worthy option?

TIA
Andy

[DougMcL]

You need to read this! You probably need to have between £30k and £50k in Premium Bonds to beat current inflation of 0.7%

https://www.moneysavingexpert.com/sa...premium-bonds/

[DougMcL]

I think this is before the prize rates went down...

[isleaiw1]

Stick it in a stocks and shares ISA, probably Vanguard Life Strategy direct with Vanguard for minimum fees.....

assume that you can leave it for a while?

[JR1664]

Over the last 12 months we've had 1.7% on £30k.

Its a safe place for some rainy day funds and you never know you might get the big 'un.

I wouldn't say its an 'Investment' though, thats a different kettle of fish. As above we have money in Vanguard Life strategy but that's a case of Investing and forgetting for a decade or so.

[AndyMD]

Originally Posted by isleaiw1

Stick it in a stocks and shares ISA, probably Vanguard Life Strategy direct with Vanguard for minimum fees.....

assume that you can leave it for a while?

Cheers for the replies so far. Minimum 2 years at the mo

[isleaiw1]

Originally Posted by AndyMD

Cheers for the replies so far. Minimum 2 years at the mo

I might stick it via an ISA into a single share with a good dividend yield then, to minimise fees and give chance of a 4% yield..... Just try and buy one that will give you the chance for an extra divi if you can stretch to a bit more than 2 years and ideally one in a robust sector where the capital value shouldnt fall....

[stefan4]

Stock and Shares ISA for Me, I have an account with Nutmeg which is very much a managed fund - make the contributions and forget about it. Then I have an account with Hargreaves Lansdown which I use to have a bit of a play and select the odd fund / share, I guess kind of a bit more of a DIY portfolio. I only started at the back end of last year, both have performed really well (~10% - 20%) with all profits reinvested. As with others, this is really rainy day funds / pension if I don't use it and trying to make the most of what little tax break I get. I'd stick it all in a pension but the trouble is, it's locked away at that point, and being self employed essentially I don't get any employer contribution.

[JustChris]

We've done well on them and have maxed ours by choice and overflowed to one of the kids. It's safe, pays a bit does hold a chance of topprize, however small that may be! It's also pretty instant access and we have already filled ISA so not so many safe options out there.

My next step is to really ramp up the pension fund which really I should have done first but this money always seems like it will be of use for something else but it looks more and more just like another part of the ongoing pension saving.

Damn Terry's sensible retirement thread, it will have me in a 2.0D pretty soon!

[AndyMD]

Super - thanks all

[Tengocity]

Originally Posted by JustChris

We've done well on them and have maxed ours by choice and overflowed to one of the kids. It's safe, pays a bit does hold a chance of topprize, however small that may be! It's also pretty instant access and we have already filled ISA so not so many safe options out there.

My next step is to really ramp up the pension fund which really I should have done first but this money always seems like it will be of use for something else but it looks more and more just like another part of the ongoing pension saving.

Damn Terry's sensible retirement thread, it will have me in a 2.0D pretty soon!

You blame me now, but you'll thank me later perhaps!

[Tengocity]

Originally Posted by DougMcL

You need to read this! You probably need to have between £30k and £50k in Premium Bonds to beat current inflation of 0.7%

https://www.moneysavingexpert.com/sa...premium-bonds/

That's a fascinating article, and incredible how complex the maths is behind it all. We had originally used PBs for our easy access rainy day fund, but cut it after the prize rate went down. But given how little it's earning in the bank, and our ISA allowance gets maxed out, then perhaps we should just put it all in there again.

[DougMcL]

Originally Posted by Tengocity

That's a fascinating article, and incredible how complex the maths is behind it all. We had originally used PBs for our easy access rainy day fund, but cut it after the prize rate went down. But given how little it's earning in the bank, and our ISA allowance gets maxed out, then perhaps we should just put it all in there again.

Agreed. I have £25k sitting in an account with next to no interest. Maybe 0.3%. How easy access do you call easy? I just want to be able to get hold of cash relatively quickly!

[Tengocity]

Originally Posted by DougMcL

Agreed. I have £25k sitting in an account with next to no interest. Maybe 0.3%. How easy access do you call easy? I just want to be able to get hold of cash relatively quickly!

We are trying to keep 6 months of our minimum monthly outgoings as easy access funds/rainy day fund, and the rest goes in to ISAs via Vanguard Tracker funds, or overpaying the mortgage. So it doesn't need to be accessible in minutes, a few days would suffice I'm sure, hence Premium Bonds do actually work fine in this regard.

[SteveChester]

I've got 50k and get the odd prize (£75 this month first win in 3 months) - holding out for the big one though!

[Pentland]

Originally Posted by SteveChester

I've got 50k and get the odd prize (£75 this month first win in 3 months) - holding out for the big one though!

£75 on £50k in 3 months. I’d be putting that £50k elsewhere.

[Bryans69]

Originally Posted by Pentland

£75 on £50k in 3 months. I’d be putting that £50k elsewhere.

Where? If you want pretty instant access (2-3 days), and 100% security, what else do you suggest?

My view of premium bonds is somewhere to put money that I'm going to need in the next 18 months or so, so can't risk ISA / shares, and might, however small, get a chance of some winnings. Couple of years back had about 30k and was getting £50 or so most months.

[JustChris]

Originally Posted by Pentland

£75 on £50k in 3 months. I’d be putting that £50k elsewhere.

That's a bit unlucky I'd say. Can't recall the last months we didn't have wins.

#believe Steve…Ernies saving the big one for you

[Pentland]

Originally Posted by Bryans69

Where? If you want pretty instant access (2-3 days), and 100% security, what else do you suggest?

My view of premium bonds is somewhere to put money that I'm going to need in the next 18 months or so, so can't risk ISA / shares, and might, however small, get a chance of some winnings. Couple of years back had about 30k and was getting £50 or so most months.

Your investment criteria and risk strategy is clearly different to mine i.e. no risk, so no point suggesting what I would do. For a 2% return (£50pm on £30k, I’d certainly do something different. ETTO.

[isleaiw1]

Originally Posted by Pentland

Your investment criteria and risk strategy is clearly different to mine i.e. no risk, so no point suggesting what I would do. For a 2% return (£50pm on £30k, I’d certainly do something different. ETTO.

Its the 100% security that does it - I have £40k in a cash ISA earning sod all, but given I work in hospitality and I am heading for 60 I feel I need a few months net pay to keep me going that is secure and available. I have £30k in a stocks and shares ISA that I top up a grand a month - its doing OK and I am not chasing the top returns, just more than the cash return. And a rental property that will make sod all in the last 12 months as I refreshed it, but generally yields 4% gross. And a pension that I top up every month. Sometimes think I need to remember to have fun too....

(and 2 kids and 2 grandkids that I help / save for most months or as needed which is my favourite spend...)

[SteveChester]

Originally Posted by Pentland

£75 on £50k in 3 months. I’d be putting that £50k elsewhere.

What in some account paying 0.02% currently....

You take your chances with it - you might win £25 you might win £1,000,000.

That said since they dropped the prize funds I've definitely seen my wins become less frequent but for me I won't be moving it elsewhere.

[Pentland]

Originally Posted by SteveChester

What in some account paying 0.02% currently....

You take your chances with it - you might win £25 you might win £1,000,000.

That said since they dropped the prize funds I've definitely seen my wins become less frequent but for me I won't be moving it elsewhere.

I’ve said already that my investment criteria is not zero risk so no, I wouldn’t put it in a savings account. That said, a guaranteed 0.02% (or 0.5% if you look around) instant access savings account, in my view, is better than a “may be will, may be won’t”, win £25 a month that you’ve achieved on premium bonds recently.