Investing for elderly father

[orangelotus]

My DF has sold his house and is now in a sheltered private housing scheme.
He has approximately 300k now in cash which is just sitting in his current account
His monthly bills will now be bigger because of service fees but but this seems a lot of cash ti have sitting not getting any interest
He has always been extremely suspicious and does not trust anyone including his own children.
What would be a good way to put this money into savings for him?
He may need care in the future so it wouldn't be ideal to tie it up.
Any advice v welcome

In the first instance you need to spread it across different institutions so that it is covered by the FSCS £85k guarantee. Stick it on high deposit whilst you work out what to do. If you go down investment route, you'll be looking at low-medium risk given his age.

If he is naturally cautious, saving with NS&I might appeal to him. You don't need to worry about sticking to the £85K limit per institution as it's government-backed, so it's simpler to manage too. You could put some in an easy access account, some in an ISA each year, and perhaps some premium bonds.

Alternatively, the Hargreaves Lansdown Active Savings service is very convenient and there are some good rates available.

A Santander 123 current account might also work well. You get decent interest on up to £20,000.

You should take advice but most accounts don't pay much. Risky to leave all in Current a/c because of fraud risk.

With that amount if it's not in ISAs he'll need to do pay tax on interest. So get as much into ISAs as possible - use this year's allowance before it vanishes at the end of the month.

Thankyou I didn't think of the tax implications!
Yes there is time to set up an ISA if he'll agree to it!!

Just to add regarding the tax payable on savings interest, you don't need to worry about declaring it, HMRC will adjust his tax code for the following year.

Make sure you get a POA for finances (or the equivalent for wherever you are in the world. When investing on someone else’s behalf and particularly if they are likely to need to pay for their care in future, it’s worth going for low-medium risk investments where funds can easily be drawn down as and when needed.

Premium bonds are safe and winnings are not taxable. I was in a similar position to your DF at the end of last year and needed to spread my money across a range of savings. I bought the maximum allowed in premium bonds (£50k) in December as I know I can cash some in if I need some money. I won £450 this month. My BIL has had £32k in premium bonds for some time and he wins quite regularly.

Not if the interest is over £10k then you have to do self assessment.

@orangelotus I agree NS &I is a good option. You could do £50k in premium bonds as any wins are tax free.

I also agree dripping £20k each year into an ISA.

The £85000 per bank is vital. Other than that keep things simple and choose investments you understand. Maybe try to get joint accounts so you can administer them for him without going the POA route if he would allow it.

Yes good point re SA if it is over £10K.

Also just to note that, depending on his pension income, he may get more than the standard £1K per annum savings interest tax free allowance. The allowance starts at £5K, and reduces by however much the income is over the Personal Tax Allowance, down to £1K.

Thankyou all so much for your help and advice

You may wish to consider a investment bond with life assured funds, thereare loewr risk options available (though not as low as cash). This type of investment isn't asessable for carehome fees, should he require care in the future. Also no need to complete a tax return on holiding the inevstemnt. The amount of interest he would be acruing on a £300,000 investment means that interst will be taxable. Speak to an IFA and take advice.

You can take a bond out for a year with the skipton. Good rates at the moment.