Last year I was left an inheritance of 300k+, I paid off my mortgage and loans and spent some money on having the house renovated.

As I have a pension income which covers the monthly expenses I am fortunate enough to be able to salt away the sums below.

Being cautious I invested 224k across 7 (32k in each) cash bonds terms varying from 1 year to 3 years and rates varying from 6.80% to 7.22%. A year on and 4 of these accounts are maturing and I am planning to spread the total sum across 3 accounts varying from 3%, 3.50% and 4.15% terms of 1 year and 2 years.

I have been asked three times now about investing in an account whereby x amount goes into a fixed bond and an equal amount goes on the stock market, the period is either 3 3/4 or 5 years. To my and my wifes way of thinking this has an element of risk attached,as I could end up only getting back what I put in 5 years before,on 50% of the investment......whereby with a fixed rate bond you know what you are getting out at maturity.

We have taken the view that the money doesn't need to be put to any risk as we are not yet using it to live on and as I have already got a pension that is protecting the investment as it allows us to put it away for 1 or 3 years at a time.

What would you do in our position?

I have got an ISA and plan to use 3600 from this years bond interest to have the wife open one too.

Thank you.

You have answered your own question - if you are anti risk and don't need the money to live on in the foreseeable future, then your current strategy of investing in fixed interest deposits is as good as any as long as you minimise your tax liabilities by splitting the investments between yourself and your wife to prevent 40% tax being due and maximise your cash ISA investments.

It might be worth having a small gamble either by a) investing in a stocks and shares ISA for this tax year(maximum £3600 each currently)

or b) investing in Premium Bonds

Hi,

Thanks for the input.....I realise now having re-read the post that you are correct I did answer my own question. However it's nice to see that you agree that the strategy I am taking is not a bad one.

I have exposure to the stockmarket through shares that my father left me (Scottish and Southern) which I think may be worth hanging onto as they are a "defensive" stock.....plus the sentimental aspect too. He left me a number of Premium Bond too which I did nothing with and they were automatically cashed in after I had been left them for a year.

I did think at the time to put the bulk of the estate in Income Bonds with NS&I but now look at their rates!

Thanks again for your thoughts.