Short term investment ideas

[pigface]

A freind of mine has recently inherited �20k. As she does not immediately need to use this money she is looking for the most effective way of investing this money. She does not currently own any property and, due being a student is probably not in a position to buy anything immediately, although, she would like to use the money eventually for a deposit on a flat. She has no debts and is currently able to cover her living expenses. Any ideas? The investment would have to be relatively low-risk

[lifelearner]

check out http://www.fool.co.uk/. You can post in the forums, they're pretty helpful.

[londondave]

I will look after it for her.

[Oneeyedvic]

also www.moneyfacts.co.uk

[Sylday]

Almost any investment involving equities (stocks & shares) involves risk, and often far more risk than the sales blurb indicates. I would advise her to stick to conventional savings accounts. For instance, she could put �3K of the �20Kinto a Building Society tax-free, non-equity, mini-ISA; and if the rules remain the same could put further lump sums of �3K per year into the same or similar ISAs in subsequent tax years. She could then put the remainder of the �20K into into an account like ING Direct or Sainsbury Bank, each of which each offer a reasonable interest rate (currently 5% gross) with immediate withdrawal, and next to no risk.

[WoWo]

Premuin bonds are good and totally risk free. Essentailly like buying �20,000 worth of lottery tickets in one go. Each month there is a draw with the top prize being �1 Million. There's no firm guarantee but your likely to make 5% interest over a year with premium bonds but could make a lot more.

[ladywolf]

You can get tax free interest from National Savings, investing up to �20K. This is as safe as anything I guess.

[rinkytink]

I think I read somewhere recently that a person with 'average luck' investing �30,000 in Premium Bonds should win about 8 prizes a year. Didn't say what amounts.

[Oneeyedvic]

Premium bonds will only get you a return of 2.8% rising to 3.2% by the end of the year (according to national savings website). Although you may get higher, you may also get lower. Savings accounts will offer a better rate than the average premium bond

[FTVS]

How much risk to her capital is she prepared to take? The higher the risk the higher the potnetial return. If she does not want to risk any capital and she wants instant access then conventional savings account likely best option.

[edkIFA]

i work for an ifa (independant financial advisor) i would suggest, 20-30 % in a  property fund, 10% corporate bond fund , 24% managed funds , 15% uk equity income 10% uk equity growth and 10% euro 5% asian emerging markets fund (this is a low-med risk exposure)

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