Short-term investment options

Monday, May 29, 2017

The question is from Chloe, 25

I've got about £10,000 saved up that I could invest. The only thing is that I'm probably going to want to use it in about two years’ time as a deposit on my first house. Should I invest the money or is two years too short a time period? If investing is an option, what sort of thing should I be looking for?

Answer by Alistair Beckett, CFPTM Chartered FCSI, Proprietor, John Roddick & Son

Under normal circumstances £10000 would not be a lot to invest and it may simply represent the client's emergency funds which should be kept as liquid as possible. Given the uncertainty regarding house purchase investment should be deferred until a longer time scale of 5 to 10 years can be accommodated. Meantime the funds should be held in a building society term account to maximise the interest earned until a decision regarding their use as a deposit is clarified.

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