Long-term gain
A few years ago, Rishi and Jaya took out a 10 year savings bond. They both had good jobs, so they could afford to put some money away for their future. Unfortunately, Rishi was made redundant so the couple had to look around to see where they could make some savings. Their first thoughts were to stop paying the premiums into the savings bond but before they made any decisions, they spoke to us for advice.
We told them that they could cash in the bond before the 10 year investment period had ended, but they might not get back all the money they’d already paid in. We told them that they would also lose the life cover offered by the bond, that would pay out if either of them were to die. They were also made aware of the option of making the policy “paid up” but again, this might have meant that they would not have received the amount that they had planned for from this policy. Rishi and Jaya took our advice and made savings elsewhere, such as by changing their utility providers and looking for better credit card rates.
We were right – not long afterwards, Rishi got a new job and the investment bond matured into a very welcome lump sum. Rishi and Jaya used some of the lump sum to help put their son through university and the rest to pay for a well-earned holiday.