Page Index Toggle Pages: 1 Send TopicPrint
Normal Topic #UK Pensioner Bonds - What's the Catch with 4% interest? (Read 489 times)
Bic Administrator


Posts: 1654
Location: Vrahassi (Vrachasi), Crete
Joined: 01. Jan 2005
Gender: Male
#UK Pensioner Bonds - What's the Catch with 4% interest?
21. Jan 2015 at 18:36
Print Post  
The new UK Pensioner Bonds: 4% over-65 savings - what they don't tell you

Below is from Martin's Money Tips......

"They smash standard best buys, but which to choose? Can under-65s access them? And can you get your cash out?

Late last week the Govt launched its pre-election bribe to over-65s via its savings arm NS&I - the 65+ Guaranteed Growth Bonds (aka Pensioner Bonds). Promptly its site form crashed & phone lines hit gridlock, causing much angst as sadly it isn't selling them via the Post Office. Our Pensioner Bonds guide has full pros & cons & analysis. In short...

Pensioner BondsThe basics. The NS&I Pensioner Bonds are just fixed-rate savings for those who've had their 65th birthday:

- You can put up to £10,000 in the 1yr bond at 2.8% (you'd earn £280 pre-tax after the year) AND up to £10,000 in the 3yr bond at 4% (you'd earn £1,250 pre-tax after 3 yrs).
- If you need to withdraw early, you can, but you'll lose 90 days' interest if you do.
- You pay normal savings tax on interest (eg, 20% for basic rate payers). Non-taxpayers can reclaim tax once the interest is paid (you can't use the standard R85 form).
What they don't tell you. To make these accounts work best for you, follow these rules...

a) If you can only do one - do the 3yr. The bond pricing is rather strange. Put cash in the 3yr bond and withdraw after a year and you lose 90 days' interest, but that's still an effective rate of 3.01%, beating the 1yr. See 1yr v 3yr.
b) How to use it for income. Strangely, as many pensioners use savings to generate income, these bonds just add interest annually. However, there is a trick to get round this - see Use pensioner bonds for monthly income.
c) The bonds aren't for all pensioners. They're for over-65s. Many women claim the state pension before 65 but that won't entitle you to these. To be fair to NS&I, it calls these '65+ Guaranteed Growth Bonds'.
d) They could sell out in weeks. Over £1.15bn of the £10bn has gone already, and demand is huge. NS&I is playing this down to reduce web strain, but we think there's a big chance they'll be gone in weeks. To be safe, apply now.
I'm too young, can I give my parents/grandparents cash to save? The terms say people must save "for their own benefit" and bonds "can't be purchased by one person on behalf of another". So in the strict sense, no. Some do this with 'no strings attached' gifts but there are risks. See full Can I use my parents' pensioner bonds? info.

What are the nearest equivalents if I'm not entitled to Pensioner Bonds? There's Santander 123 paying 3% on £3k - £20k, you can save tax-free in an up to 2.25% fixed cash ISA or 2.51% fixed savings. See full top savings, or if you're prepared to up the risk slightly for potential returns of up to 6%, consider Peer-to-Peer Savings."

Comments taken from the newsletter.
« Last Edit: 21. Jan 2015 at 18:38 by admin »  

Treat fairly, those who treat you fairly. To shout is a sign of weakness. Confucious may have said: "Don't be easily hurt or offended. Take a deep breath, count to 10. Log off and make a cup of tea.
Back to top
IP Logged
Page Index Toggle Pages: 1
Send TopicPrint
Bookmarks: Digg Facebook Google :: Brits in Crete Google+ Linked in reddit StumbleUpon Twitter :: Brits in Crete Yahoo Pinterest :: BritsinCrete Tumbr :: Britsincrete Instagram :: Britsincrete

Weather forecast for Heraklion Weather forecast for Rethimnon Weather forecast for Agios Nikolaos Weather forecast for Ierapetra Weather forecast for Chania

HOTELS NEAR AIRPORTS: Athens Eleftherios Venizelos Airport (ATH) - Chania/Souda (CHQ) - Heraklion Nikos Kazantzakis Airport (HER) - Sitia Public Airport (JSH).

De werkelijkheid van het leven, het leven van de Emigrant in Kreta Griekenland, zoals die door de ogen van de Britse ingezetenen wordt gezien. | Die Wirklichkeit von leben die Überseelebensdauer in Kreta Griechenland, wie durch die Augen der britischen Bewohner gesehen. | La réalité de la vie, la vie d'outre-mer en Crète Grèce, comme vu par les yeux des résidants britanniques. | Realtà di vivere, la vita espatriata in Creta Grecia, come visto attraverso gli occhi dei residenti britannici. | V tat a k člen určit "Brit do Kreta" "BritsinCrete" tkanivo poloha. | A realidade de viver, a vida expatriate em Creta Grecia, como visto através dos olhos dos residentes britânicos. | La realidad de vivir, la vida expatriada en Creta Grecia, según lo visto a través de los ojos de los residentes británicos. | Живущ в Крете, межсуточная жизнь на греческом острове Креты для эмигрировавших резидентов. | Ζωντανός στην Κρήτη, καθημερινή ζωή στο ελληνικό νησί της Κρήτης για τους εκπατριζόμενους κατοίκους. | クレタに住んでいる、国外居住の常駐員のためのクレタのギリシャの島の日常の生命。| aae:Kret ar: كريت bs:Kreta bg:Крит ca:Creta cat:Creta cs:Kréta cym:Creta da:Kreta de:Kreta et:Kreeta el:Κρήτη es:Creta eo:Kreto eu:Kreta eus:Kreta fr:Crète he: כרתים hrv:Krit ko:크리티 지역 hr:Kreta id:Kreta is:Krít it:Creta la:Creta lb:Kreta lv:Krēta lb:Kreta lt:Kreta hu:Kréta nl:Kreta ja:クレタ島 no:Kreta pl:Kreta pt:Creta ro:Creta ru:Крит sl:Kreta sr:Крит fi:Kreeta sv:Kreta tr:Girit vec:Creta zho: 克里特 Crete. Βριτσιν is another display type!

  « Board Index ‹ Board Top  

QR Code britsincretecouk | Google+ | Today's GREEK NAME DAYS and BABY NAMES | Feedage Grade A rated |

Forum installed & Maintained by SVS WebDesign