The Chancellor has extended the 65-plus pensioner bonds scheme for three months, meaning over a million over-65s will benefit further from market-leading savings rates.
The Government’s 65-plus pensioner bond has seen huge popular demand and is the most successful savings product in our history. That’s why the Chancellor has guaranteed the bonds will be available for the next four months, meaning millions more pensioners will have the opportunity to benefit from market-leading savings rates.
The three month extension of the new pensioner bonds is to help retired savers get a better return on their savings income. The NS&I bonds, initially made available for one month, will now be available until 15 May 2015. There has been unprecedented demand for the bonds, with £7.5 billion sold so far to over 610,000 savers. It is now expected £15 billion of bonds will be sold, against £10 billion originally allocated.
The bonds offer market-leading rates. Two bonds are available, with a one year bond at 2.8 per cent gross/AER, and a three year bond at four per cent gross/AER. It is limited to £10,000 per bond per person.
Chancellor George Osborne said: “Our 65-plus pensioner bonds have been a huge success, and are already helping hundreds of thousands of older savers who have done the right thing, by boosting the return on their savings and securing a more comfortable financial future.
“I want to ensure as many older savers as possible can take advantage of these market-leading bonds, which is why I’m confirming today that potential savers will have months to invest in these hugely popular products, if they wish.
“It’s part of our long term economic plan to support savers and boost hardworking peoples’ financial security at all stages of life.”
Chelsea and Fulham is home to approximately 12,800 people aged over 65, who make up just over 12 per cent of the local population.
Local MP Greg Hands said “I welcome the extension to the pensioner bonds scheme which gives over-65s the opportunity to get more from their savings, helping pensioners be more financially secure in their retirement. I hope these measures will also be welcomed by many of the 12,800 over-65s in my constituency.
"Under Labour’s system pensioners were given rises as low as 75p per week. In 2000, the basic state pension rose from £66.75 per week to £67.50 per week, an increase of just 75p. In contrast we are guaranteeing the value of the state pension. The triple lock guarantees that the Basic State Pension always increases in line with the largest of earnings, prices, or 2.5 per cent. From 2011/12 to 2012/13 that meant a rise of £5.30 – the biggest ever cash rise. Since 2010 the annual basic state pension has risen by £800.
"Labour left the country in the deepest recession since the war, and as a result many pensioners have seen their incomes fall as a consequence of the low interest rates pursued to support the economy during this difficult period. It’s time Britain helped them out in return.
"That’s why we’re giving them this extra support, helping people who have worked hard and saved hard to be more financially secure in their retirement. This Government backs savers, and supporting people who do the right thing is part of our long-term plan to fix what went wrong in our economy."
With an investment limit of £10,000 per bond per person, the bonds are available directly from NS&I by post, phone or online here.