Can you please recommend what's the best way to keep some money away without losing its value?
05 April 2022
Question by Jill
I have been saving to give my six grandchildren a help for the deposits for their homes. They are in their late twenties now so may need it sometime soon. I want to put it somewhere where it would keep its value until then
Answered by Boring Money
First, well done to you for doing that for six grandchildren! I'm sure it's something they'll really thank you for and be a big help to them.
You don't have an easy job at the moment trying to find somewhere that you can easily access to give to them at short notice, and also keeps pace with inflation.
Generally speaking, the best way to try and keep pace with inflation is to invest, which of course carries risk and is generally not suitable unless you are prepared to put the money away and not touch it for a few years at least, which is not your situation based on what you've written.
Despite this, you could invest for the shorter term, but there is every chance that the amount you get back out to give them is less than what you put in, so this is something you'd need to be comfortable with, if trying to keep its real value is the most important thing to you.
If easy access to the money and not taking risk with what you've worked to save are more important to you, then putting it in an easy access savings account will do those things, but will mean the money loses its real value relative to inflation and the best you can do is get the highest rate such as those shown here: https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/
There is a third option, which is a halfway house between saving and investing, and that is putting money into an Innovative Finance ISA. Which you can read more about here:
I suspect however that an Innovative Finance ISA may not be appropriate for you, as you have to tie up your money for a period of time in a lot of cases.
Hopefully this helps, however I am happy to have a chat if it'd help