Where to invest 85k—1, 2 or 3 yr Fixed Rate Deposit Account best?

[Peregrina]

Hi Folks,

I'd be really grateful for your advice on what to do with a recently-matured lump sum of approx 85k. It’s my life savings and I prefer not to run the risk of losing it, e.g. through entering into an investment scenario.

I usually opt for midium-term Fixed Rate Deposit Accounts and already have the maximum in Premium Bonds with the NS&I. I’m looking to maximise returns (access won’t be necessary and yearly interest payments are preferable).

Given the low rates and bleak economic forecast, would you recommend tying the money up for 1, 2 or 3 years—or even longer? The main question is whether it’s more probable that the savings panorama will be better, or even worse, in December 2021, and further ahead, in 2022?

Which? Magazine gives the following guidance:

1 Year Fixed Term Deposit
Recommended Provider: Paragon Bank 1 yr: 0.6%

2 Year Fixed Term Deposit
Ford Money Fixed Saver 90% - Tandem Bank gives this rate too, see below.
Which? Recommended Providers list several reputable options, including Shawbrook: 0.85%

Another option:

Tandem Bank - I've no experience of this challenger bank, but it is FSCS protected.

1 year Fixed Saver: 0.80%
2 year Fixed Saver 0.93%
3 year Fixed Saver 1.0%

Your help and suggestions would be welcome and greatly appreciated.

Many thanks in advance for any help you can provide.

[dealtn]

Hi Folks,

I'd be really grateful for your advice on what to do with a recently-matured lump sum of approx 85k. It’s my life savings and I prefer not to run the risk of losing it, e.g. through entering into an investment scenario.

Is that the entirety of your life savings, it isn't clear?

The phrase "life savings" suggests it is, although you mention premium bonds too, which suggests it's only part of your life savings.

If yes, and it were me, I wouldn't want it tied up in a single institution, or all for one period.

If no, what percentage is it, and where is the rest located?

[GrahamPlatt]

AJ Bell’s (YouInvest) “Savings Hub” recently offering 1% for a one year term.

[Gan020]

Choices are around 0.5% instant access, 1.0% 1 year, 1.0% 2 years, 1.25% 5 years.

I don't see the premium for anything over 1 year as sufficient.

So, imho the choice is either 0.5% instant access or 1.0% 1 year bond and then see what things look like in a years time.


It depends whether you see rates going up or down next! I see them going up.

[scrumpyjack]

An alternative is to put some (or all if you have a wife) into Premium Bonds

The 'interest' rate (ie the total value of prizes cf to the value of bonds) is 1% and it isn't taxable

The money is not tied up for years and is as secure as it gets.

[dealtn]

An alternative is to put some (or all if you have a wife) into Premium Bonds

The 'interest' rate (ie the total value of prizes cf to the value of bonds) is 1% and it isn't taxable

The money is not tied up for years and is as secure as it gets.

According to the OP ...

"I ... already have the maximum in Premium Bonds"

[scrumpyjack]

An alternative is to put some (or all if you have a wife) into Premium Bonds

The 'interest' rate (ie the total value of prizes cf to the value of bonds) is 1% and it isn't taxable

The money is not tied up for years and is as secure as it gets.

According to the OP ...

"I ... already have the maximum in Premium Bonds"

Silly me, I should read posts more carefully