You are here: Home - Investing - Experienced Investor - News -

One-year fixed term investment bond pays 2.00%

0
Written by: Paloma Kubiak
17/03/2017
Castle Trust is offering attractive rates on it four investment Fortress Bonds. Here’s what you need to know.

Castle Trust is offering favourable rates on its Fortress Bond,s which are fixed term fixed rate investments between one and five years that differ from traditional savings accounts.

As they’re investment based products your money is protected in a different way (see below for more).

The bonds are issued in monthly tranches with interest payable quarterly or at maturity. The rates are as follows:

  • One-year bond: 2.00% (best buy alternative is from United Trust Bank paying 1.65%)
  • Two-year bond: 2.10% (best buy alternative is from United Trust Bank paying 1.80%)
  • Three-year bond: 2.20% (best buy alternative is from Atom Bank paying 1.90%)
  • Five-year bond: 2.50% (best buy alternative is from Milestone Savings paying an expected rate of 2.30%).

The deadline to apply for the Fortress Bonds is 2pm on Friday 31 March and the minimum investment is £1,000, while the maximum is £250,000. An important point to note is that there is no early access to your money before maturity – unless the account holder dies.

All four versions of the Fortress Bond are eligible to be held within an ISA wrapper, though Castle Trust confirmed it pays the same rates irrespective of whether the bond is held within an ISA or not.

How is your money protected?

The Fortress Bonds are covered by the investment branch of the Financial Services Compensation Scheme (FSCS), not the deposit branch. This means that investors are covered up to a maximum amount of £50,000 under the FSCS.

Castle Trust is regulated by the FCA but it includes this disclaimer on site: ‘You risk losing capital should Castle Trust become insolvent’, which relates to any amount not covered by the FSCS.

Rachel Springall, finance expert at Moneyfacts, said: “The Castle Trust Fortress Bonds could be an alternative for savers looking for high interest but it is worth mentioning that they do not work the same way as a traditional savings account.

“These are investments whereby savers effectively lend their money to the company in return for an interest rate on that loan. This means that their capital could be at risk if Castle Trust runs into difficulties, such as if they become insolvent.

“With this in mind, it’s vital that savers make themselves aware of the risks, particularly as there is no early encashment allowed. Those concerned may prefer to opt for a more traditional savings account as a safe haven for their cash.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

After an award-winning health insurance provider?

Winner of best online health care provider in the YourMoney.com Awards 2015

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
springclean
The ultimate guide to spring cleaning your finances in 2017

Spring is nearly in the air and so it’s also the time to get your financial affairs in order. Here...

Close