Better return for LISA cash only for house deposit?

[stacker512]

I've 33k in a LISA with HL, 100% of it is cash.
HL's LISA page says they pay 1.5% AER.

Can I get a better return?

Would investing in some sort of money market fund be a good idea?
One that was mentioned in a LF thread was Royal London Short Term Money Market, but the yield is 2.21% and charges 0.10% (so really 2.11% yield).
Not sure if worth it.

I'm not likely to buy anywhere for the next 1 - 3 years.

[EthicsGradient]

I'm too old for a LISA, so have never investigated, but it does seem to me from this you could do better: https://www.moneysavingexpert.com/savin ... time-isas/

[stacker512]

Some of those offerings are a bit rubbish - Moneybox and Beehive need the use of an App. Why? I don't want to be locked down to just using an app.

Paragon might be worth a try, but it's only 2.5% compared to 2.2% on that fund. Is it worth doing a jump just for 0.35%?

[EthicsGradient]

Some of those offerings are a bit rubbish - Moneybox and Beehive need the use of an App. Why? I don't want to be locked down to just using an app.

Paragon might be worth a try, but it's only 2.5% compared to 2.2% on that fund. Is it worth doing a jump just for 0.35%?

Using an app probably makes them more efficient. It's be worth about £500 a year to you, compared to your current HL LISA. Is it that you don't have a smartphone, or that you think you're going to be constantly checking it, and don't like using your phone for that?

The jump to Paragon would be from your 1.5% HL, not the 2.1% in the money market fund. So that'd be £330 a year. Up to you.

[gpadsa]

One that was mentioned in a LF thread was Royal London Short Term Money Market, but the yield is 2.21% and charges 0.10% (so really 2.11% yield).

The fact sheet says

The Fund’s performance target is to outperform, after the deduction of charges, the Bank of England Sterling Overnight Interbank Average (SONIA) over rolling 12-month periods.

so it is meant to track SONIA (currently 4.4%) which seems to stick slightly below Bank of England rate (currently 4.5%). Less the 0.1% ongoing charge so it should be about 4.3%pa at the moment. The bank rate has changed quite a lot over the last 12mo (I guess the 2.21% is 12mo trailing yield?).

FT says the 3mo yield is 0.98% which matches the historical prices:
17 Feb 103.99
16 May 105.00
(I make it 0.97%)

gpadsa

[NancyCastro]

I've 33k in a LISA with HL, 100% of it is cash.
HL's LISA page says they pay 1.5% AER.

Can I get a better return?

Would investing in some sort of money market fund be a good idea?
One that was mentioned in a LF thread was Royal London Short Term Money Market, but the yield is 2.21% and charges 0.10% (so really 2.11% yield).
Not sure if worth it.

I'm not likely to buy anywhere for the next 1 - 3 years.

it's important to consider a few factors before making a decision.

Risk: Money market funds are generally considered low risk, but they are not completely risk-free. There is still a possibility of fluctuations in the value of the fund and potential defaults on the underlying securities.

Access to funds: If you plan to use the funds within the next 1-3 years, it's important to ensure that you have easy access to your money. Money market funds typically offer quick access to your funds, but it's important to check the terms and conditions regarding withdrawals and any associated fees.

Charges and fees: Consider the charges associated with the money market fund. The Royal London fund has a 0.10% charge, which reduces the net yield. Compare this with any charges or fees associated with your current LISA.

Personal risk tolerance: Assess your personal risk tolerance and investment goals. If you are uncomfortable with any level of risk or prefer to prioritize capital preservation over potentially higher returns, it might be better to stick with the cash option within your LISA.

[airbus330]

My daughter uses Beehive which is 3% last I looked. Web based access rather than App and very easy to navigate.
Personally, with the US debt issue now solved I'd be tempted by the Royal London option, which I hold myself. But as said above, not totally risk free in these strange days.

[stacker512]

Charges and fees: Consider the charges associated with the money market fund. The Royal London fund has a 0.10% charge, which reduces the net yield. Compare this with any charges or fees associated with your current LISA.

I thought someone had explained to me a while back (maybe on the MSE forums?) that the yield quoted is net yield.
Is that still true?