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gevived

Is it wise to use fixed-term savings products for medium-term goals? - 4 views

started by gevived on 06 May 25
  • gevived
     
    Hey folks, I'm saving for a big trip in about three years and weighing my options. Easy-access rates are meh, but I could lock cash into a 2- or 3-year fixed-rate bond and earn more. My worry is that life will throw curveballs-what if I need the money earlier? I've also been tempted by different types of ISA but don't want to complicate things. Is a fixed-term product smart for a goal that's neither short nor super long term?
  • glcol1223
     
    I faced a similar choice when saving for a house down payment over four years. I split my stash: half in a 3-year fixed bond for solid returns and half in a Cash ISA with instant access. There are several types of ISAs to consider-Cash ISAs, Stocks & Shares ISAs, Innovative Finance ISAs, Lifetime ISAs and Junior ISAs-each with its own tax advantages and eligibility rules. That gave me peace of mind and tax perks too. If you want a clear look at fixed-term options, check https://moneyfactscompare.co.uk/savings-accounts/fixed-rate-bonds/. It lays out scenarios for medium-term goals versus other products. And though ISAs have benefits, fixed bonds often beat standard Cash ISA rates once you factor in term length.
  • mark110
     
    This is a handy conversation. I've always saved exclusively in my easy-access Cash ISA because I hate missing deadlines, but hearing about splitting into term bonds makes sense. I'd be tempted to lock part away if I knew I wouldn't touch it until the trip.

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