If you are a holder of an NS&I 65+ Guaranteed Growth Bond, the terms may be due to run out and we are encouraging you to review your options as it could result in a significant drop in the interest rate.
The bonds that were available in January 2015 and offered a 4% return over three years, are due to mature on the 15th January 2018.
The government is in the process of informing bond holders of their options:
- Reinvest the money into another bond with an alternate term (1,2,3,5 years)
- Reinvest into the current Guaranteed Growth Bond, with an interest rate of 2.2% rather than the 4% that was on offer previously
- Cash in the bond – the money will be paid directly into your chosen bank account
The key thing to remember is that if you wish to use the money in the short term, you won’t want to tie up the money for a further 3 years. Not only this but the previous interest rate of 4% has dropped to 2.2% and therefore the return will not be as good as you will have experienced before.
However, if you are happy to invest the money for a specified period, the bond offers the safety of a guaranteed interest rate and therefore may be beneficial if you are looking for steady growth.
You must make your decision no later than two working days before the 15th of January, if you do not contact NS&I with your decision, your money will be automatically reinvested into the current Guaranteed Growth Bond with the newer rate.
If you hold one of these investments and would like to discuss your options going forward, please feel free to contact your adviser at MPA or get in touch via the MPA office.
For more information on the product, please see the NS&I website below: