First Active Elevator vs Rabo/NR Deposit over 5 years

C

cool_cat

Registered User
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Hi There,

Just looking at options for a 20K lump sum. First Active's [broken link removed]guarantees 22.30% gross (AER 4.11%) over a 5 year term with access to your funds.

What are the chances of this outperforming Rabo/Northern Rock deposit rates over the 5 year period? My fear is that interest rates are peaking and could start going down fairly quickly in Rabo/NR, whereas the elevator rate are guaranteed.

Any help appreciated.

Thanks!!
 
If you think rates are going down and are looking for security then you have answered your own question really and should go with the elevator a/c. However, I don't think you will find many takers on rates going down over the next year at least.

Also, if you're investing for 5 years it is likely that stock markets will outperform cash over that period. Why not dump it into NR and contribute 1000 per month into a low charging fund?
 
Thanks Calico - I have already invested some of my savings into stocks. This is the bit I am keeping for a rainy day...I think I might go for the elevator, as it has guaranteed returns and funds are accessible should I need them.
 
What I don't understand about Elevator is that it seems to be the best of both worlds.

It is a 5 year fixed term deposit and at good rates at that, so if interest rates fall you are on a winner.

But if interest rates rise you can cash in your chips and accrued interest without penalty and move to a higher paying deposit.:D

What am I missing?:confused:
 
Harchibald said:
But if interest rates rise you can cash in your chips and accrued interest without penalty and move to a higher paying deposit.:D
Click to expand...
Are you [broken link removed]?
Access to your funds
  • ...
  • Please note that withdrawals may affect the amount of interest you earn
Click to expand...
Can't tell for sure from their website because...
Terms and Conditions

 For full details of the terms and conditions, just ask for a copy of the Elevator brochure at your local First Active Store.
Click to expand...
What am I missing?:confused:
Click to expand...
I presume that you have considered the fact that 4.11% gross CAR is 3.29% net of DIRT and CPI inflation is c. 5% right now?
 
Ts&Cs are the final arbiter but they're not online so it's difficult to say for sure.
 
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