Savers looking for a guaranteed return over a fixed term and a low minimum investment should pop down to the Post Office where they have introduced a bond that offers just that.
The Post Office bond pays interest over a 12 month period at a rate of 7.05 percent and with a minimum investment of just GBP500 is accessible to pretty much everyone. As long as customers can leave the money intact for the year then they can earn a great rate of interest guaranteed. Such guaranteed investments are becoming more popular than ever now that the economy is in such a difficult position. Investors are looking for security rather than extravagant claims.
For anyone interested in what is an excellent savings and investment opportunity the bond can be invested in either direct at the Post Office Insurance counter, by phone or online and that GBP500 minimum investment amount is certain to make it very popular.
According to a study carried out by the Abbey National recently a number of UK people are dipping into their savings in order to pay their ongoing bills.
The Abbey National was looking specifically at money held in ISAs and, having seen around GBP6 billion taken out of them asked customers what the money had been used for. Just over 30 percent of people said it was to cover day to day expenses, the most popular answer provided.
Although it can seem easy to use savings to cover costs the issue comes a little later said an Abbey National spokesman. If a cash ISA had the maximum put into it then any withdrawals cannot be made up later, leaving the account holder with a reduced return through interest.
Egg, best known for the Egg credit card has just introduced a new bond that is linked to the FTSE100 performance over the next 3 years.
Called the FTSE 26 percent guaranteed equity bond, Egg card customers who invest in it will enjoy FTSE 100 index gains made over and above the starting level of the bond up to a maximum of 26 percent. Should the index finish lower than the starting point of the investment then customers are guaranteed the whole of their capital invested back.
An Egg card spokesman suggested the investment bond would suit customers who are naturally cautious but would like the chance to earn a higher return than that offered by simple deposit accounts.