Saving long term: money matters

See the options for growing and protecting your money long term — for retirement, buying a home, paying university fees, or just for a rainy day

There are lots of saving and investment options to give you the returns and financial flexibility you need for your particular circumstances. You may choose to combine several savings products to give you the balance of access, flexibility and return that you're looking for. Here we run through the pros and cons of your main options.

Long term savings — things to think about

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Before you start researching your savings options, you should consider:

• whether you plan to add regular payments to your savings
• when you need your money back
• whether you need instant access
• the amount you hope to save
• whether you can afford to accept some risk
• what your personal tax situation is

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Savings or deposit accounts

Savings accounts can be a low risk way of saving for the future. They're a good option if you want to save regularly, but less effective if you're looking for higher potential returns.

• Usually instant or quick access, although penalties can apply.
• A secure home for your money: savings accounts offer minimal risk to your capital.

• Low rates of return, compared to riskier or less flexible options — though they usually offer higher interest than a current account.

See our Bonus Saver Account
See our Money Market Call Account

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Shares and bonds

If you're looking for an option that gives you a lot of control and flexibility, you might consider buying shares and bonds. For a quick introduction, see our Guide to investment.

• High potential returns: if you choose the right companies to invest in, the returns could potentially be higher than other financial products.
• You're in control: you choose what to buy and sell, where to concentrate your investments and how to balance the risks.

• Require financial expertise: to feel confident investing you'll need considerable experience — or you can employ a professional at a cost.
• Can be inflexible: bonds usually have a minimum investment period and carry penalties if you redeem them before the end of that period.
• Dealing costs: some of your money will be eaten up by the charges involved in dealing on the stock market.

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Investment funds

An easy way to invest in shares and bonds is through a fund. When you buy into a fund you pool your money with other investors and place it in the hands of an experienced fund manager.

• A wide choice of funds: choose your level of risk, the area you're investing in and whether to go for income or growth.
• Flexibility: with Lloyds TSB International funds you can sell all or some of your shares whenever you choose, with no penalties. You can also invest a little at a time through our regular savings plan.

• A level of risk: if you choose a fund that offers a large return on your investment, you'll risk losing some of your money.
• Fees and charges: you'll usually have to pay a management fee up front, plus a percentage every year.

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Structured products (OLEDs)

Structured products such as our Offshore Limited Edition Deposits (OLEDs) enable you to benefit from the potential growth of world stock market indices without the potential risk to your capital as they are 100% capital protected† upon maturity. The details of each OLED offer varies and can offer the potential for capital growth and/or a regular income. They can also be available in sterling, US dollar and euro.

† The use of the words '100% capital protection' on this website refers only to the obligation of Lloyds TSB Offshore Limited or Lloyds TSB Bank (Gibraltar) Limited to repay your capital and any specified return in full on the Repayment Date. The deposits mentioned on these pages are not guaranteed by any third party. The minimum guaranteed return is subject to the Offshore Limited Edition Deposit (OLED) being held for the full term. If you withdraw your money early you may receive back less than your original capital amount.

You might choose to deposit in an OLED alongside less risky options, for example a Bonus Saver Account.

• A choice of deposits offering potential for attractive returns at maturity, or an annual return.
• 100% capital protected† at maturity - you'll receive back at least your original deposit, provided you leave the money until the deposit matures.

• Uncertain returns: if you're unlucky with stock market behaviour or other conditions of your chosen OLED, you may not receive a return other than your original deposit amount.
• No access to your money: OLEDs usually run for a set term, with no withdrawals allowed. You can cancel a Lloyds TSB International OLED but you may receive back less than you initially invested.

See our Offshore Limited Edition Deposits (OLEDs)

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Pensions

Pensions are specifically for retirement savings, and can't be accessed before you reach retirement age. They're usually made up of investments in stock markets, so their value will fluctuate.

• No-fuss savings: your pension contributions can be deducted automatically from your salary, so you don't have to think about saving.
• Often tax-efficient: because governments encourage saving for retirement, you will usually not pay tax on your pension contributions.

• Uncertain returns: the value of your pension fund isn't guaranteed. At the time you retire it may be less than you had hoped for.
• May be less efficient abroad: if you work abroad, pension tax advantages may not be available to you. We recommend that all our customers seek independent personal tax advice.

See our investment funds

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