Fixed 5 year bond

[Caramel78]

I have most of my savings tied up in a 5 year fixed bond which I can’t access until 2024. I’m self employed and have now lost all of my income. I contacted the company my money is with (Shawbrook Bank) and they are saying I’m not allowed to withdraw it early (even if I were to lose my % and pay a penalty).
Do I have any rights with this? Thanks

My bank sent me an email saying they will allow withdrawals from fixed rate bonds because of the unusual circumstances of the Coronovirus
Ring them and ask if they will allow you to do so
Im sure they will

Thanks. I did email them and they said no but this was a few days ago so they may have changed their minds now. I’ll try again next week.

I sympathise with your situation but I can totally see why they would refuse. with a 5 year bond, the deal is that they invest the money in the financial markets and have effectively laid a bet that they can grow the lump sum by more than X% over 5 years. X% being the amount of interest at fixed rate that they have agreed to pay you. if they succeed in earning more than that with their investments then they win the bet, they keep all the excess over X%, you get the X% promised and they have a nice profit. if the investments perform poorly they still pay you the X% but they have lost the bet.

all financial markets are in deep doo doo at the moment for obvious reasons. your £5k investment is probably only worth £4k at the moment as the funds it was invested in will have tumbled. if they get to keep the funds they have a chance to reinvest in funds which will perform well over the next couple of years as the economy recovers, and they may manage to grow your investment back to more than £5k+X% and at least break even, possibly even make a profit. if they let you take the funds now they will definitely make a big loss. it's a massive thing for you to ask of them - this is their livelihood.

I get that - but I wasn’t expecting to suddenly lose all of my income with no prior warning to plan a bit ahead. They have pretty much said I can’t have my money early so that’s that. Not much more I can do.