There seems to be much interest in 'Pensioner Bonds' as announced in George Osborne's Budget speech in March 2014 – since then some detail has been released but we still don't have the full picture. So this is what we know so far.
- Firstly the name, they won't be called 'pensioner bonds' they will be called 'Plus 65 Bond'
- They will become available from January 2015
- They will only be available to those aged 65 and over.
- If you're under 65 you can have a joint bond with someone who is over 65
- There will be a 1 year and a 3-year option.
- The minimum investment will be £500
- The maximum investment will be £10,000 per bond and an individual can only have one of each so a maximum investment of £20,000
- They will NOT be tax-free.
- Interest will be paid annually not monthly.
- 1They will be sold exclusively through NS&I
These are the things we know what we don't know is the interest rate that will be offered through it is strongly rumoured to be annually 4% Gross (3.2% Net) for the 3-year bond and 2.8% Gross (2.24% Net) for the 1-year version. Another big unknown is how quickly they will 'sell-out' it's understood that National Savings & Investments will have a limit on how many bonds they can issue.
When I know the rates I will publish them on this blog.