I'm in A2 year and looking to invest £3600 in a 5 year 4.50% fixed interest rate account.
This will leave me with £1000 to help for general uni living costs.
After speaking with my father, he seems to believe that inflation will rocket soon and that historically, interest rates are above 5%. I infer from this, the 5 year term is not such a good idea?
Thanks for any advice
you infer correctly sheriff
Although i am not qualified to give financial advice. I would say your Dad is correct. In all likelihood in order to reduce the burden of debt on the economy some of the debt will be inflated away.
In my opinion, inflation is stable. If the MPC do their job properly it should stay that way, though the MPC are likely to stop its quantitative easing programme soon.
5 year might be a bit long... go for something along the lines of 3%.