Gerry557, thanks for your reply
Rates are expected to drop, possibly three times this year. So whist you might get a decent 12m rate it's unlikely to be repeated. I assume she's a tax payer so would need to look into the savings tax allowance. I think she might get the extra £5k.
Hmm I hadn't thought about the starting savings allowance. Part of her monthly income is actually attendance allowance and so is unlikely to count as income for that savings rate. So there might be some added tax benefit there.
The other option is bonds or bond like equities that offer a higher dividend yield. NG., Trig, UKW, SMIF etc These might not blow the roof off but could provide a decent income and more likely to rise as rates drop. These could offer 5.5% - 9% albeit with a fluctuating capital.
It's the risk of the fluctuating capital that bothers me most, but maybe it shouldn't. I've wanted to protect her capital so that she can start spending it down as she gets older. I don't want to be in a position where we HAVE to sell shares NOW for income, and be in a large dip in value. Possibly with that a good dividend yield the capital is much less important, and someone else has suggested an annuity with a guaranteed income. So I perhaps need to change my mindset about the risk.
It might be best to discuss it with her on how she feels. Additionally she should get another ISA allowance in the new tax year anyway so might not need the APS.
She will agree with the last person she spoke to. Her own ISA allowance will be taken up with her own cash that's currently outside an isa and potentially a new £10k lump sum that might come in April.
I would also ask if she has a will and who the executor is. They might find some of this useful.
She is in the process of rewriting her will as it is no longer relevant now my dad has gone. I am the executor with my brothers, but let's assume I will do everything, as that's what's happened with dad's will.
Thanks
Jopo