Older savers who hold so-called ‘pensioner bonds’ with a four per cent return are being urged to review their options as the terms run out.
The bonds, which were available to those over 65 with a four per cent return over three years, start to mature on 15 January 2018.
Pensioners were allowed to invest £10,000 each in the bonds, with those who put away the full amount in January 2015 now having £11,300 to reinvest.
If customers with maturing bonds do nothing, their cash will be automatically reinvested into the NS&I Guaranteed Growth Bond, which pays 2.2 per cent, a 43 per cent drop on the previous generous rate.
The money will, once again be tied up for three years, or savers can access it early but will lose 90 days interest.
With inflation currently at 3% this investment will lose its buying power in real terms. On the other hand it is very secure so I can see pros and cons.”
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