Investec High 5 - Is There a Catch?

[timsk]

Thanks for the interesting and lively debate folks, I've got a lot more than I bargained for when I started the thread!

A small piece of background info' for you all, followed by a question. The account was recommended to my wife by a friend of ours who has just opened an Investec High 5 account himself. He's got 50 years of active investing under his belt and has, at times, been extremely successful. He's understandably proud of the fact that his percentage returns knocked spots of Mr. Buffett's throughout the 90's. However, he's now 80 and the LTBH investment approach no longer makes sense as time isn't on his side. He wants a safe haven for his money and to know that his wife won't have to worry in the event that he's the first to depart the mortal coil. The question is - what can people like him (and, indeed, my wife who has no interest in finance and investment) do with their money to get a better return without taking speculative risks? In this context, isn't this account about as good as it gets in the current financial environment?
Tim.

 

[Martinghoul]

In answer to your question, Tim, as I have mentioned before, I think the Lloyds 3% instant access savings account is actually a better deal. If Lloyds weren't such a sh1t bank (in my personal experience), I keep my money with them.

 

[maiden22]

Thanks for the interesting and lively debate folks, I've got a lot more than I bargained for when I started the thread!

A small piece of background info' for you all, followed by a question. The account was recommended to my wife by a friend of ours who has just opened an Investec High 5 account himself. He's got 50 years of active investing under his belt and has, at times, been extremely successful. He's understandably proud of the fact that his percentage returns knocked spots of Mr. Buffett's throughout the 90's. However, he's now 80 and the LTBH investment approach no longer makes sense as time isn't on his side. He wants a safe haven for his money and to know that his wife won't have to worry in the event that he's the first to depart the mortal coil. The question is - what can people like him (and, indeed, my wife who has no interest in finance and investment) do with their money to get a better return without taking speculative risks? In this context, isn't this account about as good as it gets in the current financial environment?
Tim.

It's a very complex question, that can't be answered properly without a lot more information.

However, if you just want a bank account, then yes I would say that this is a pretty good one.

A couple of things:

You can get better rates if you fix for a few years - but what do you think the likely direction of rates and inflation is going to be over the next 3 to 5 years.

There are lots of accounts that open with good rates and then kick you down to something derisory after a bit. This at least should stay up there. Really, unless you're talking a lot of money there's little point in rate chasing. This account removes the necessity - it willnever be the best, but it should always be quite good.