Tina, hello there.

This is a "how long is a piece of string" question. My - very personal - gut feeling is that you need to look at some form of high interest savings account/index linked saving scheme, rather than any equity-based investment.

Why is that? Simply because if you invest in any share-based fund for a period of just three years, you are taking an incredible risk that the market may move against you in that time. Historically, shares have outperformed cash as a vehicle for people's savings, but you really need to look at a 15 to 20-year time frame to be sure. The absolute minimum is 10 years, IMO.

You may, of course, want to talk to an independent financial adviser (IFA), but I don't believe any sane IFA will tell you a different story.

Have a look at doing one of two things: see if you can stuff £3k of that money in a tax-free ISA and reinvest the rest in a high-interest account. You can look to transfer more of that money into a tax-free account next year.

The other option is to look at National Savings & Investments index-linked certificates, which match the rate of inflation plus a certain amount, currently between 1.3% and 1.6%. NS&I uses the RPI as opposed to the lower CPI indicator of inflation. For example, last month's annual CPI rate was 3.1% while the RPI was about 4.8%. You would have got the RPI rate.

The rate paid is tax free, like ISAs.

You can invest for 3 years and the minimum investment is £100, with a maximum of £15,000. The link to NS&I is here: http://www.nsandi.com/index.jsp

Hope this helps,

Nic