John and Margaret are both aged 60. Their family is grown up and gone so they have sold their house and traded down to a smaller one, leaving them with a lump sum of £30,000. Margaret does not work and John will retire in five year's time and would like to use the lump sum to bolster his company pension. They have always been depositors and would consider themselves cautious - they would not expect to end up with less than £30,000 at the end of the five years.

John and Margaret's options are limited by wanting to have their capital guaranteed - this would suggest that they are not natural equity investors. On the positive side, they do not need the money for five years. They can therefore afford to lock it away and earn a higher return rather than simply leaving the money as cash on deposit.

Financial advisers suggest that they consider splitting the sum into two equal parts of £15,000 or dividing it into two sums of £20,000 and £10,000 rather than opting for a single investment product. The couple could then consider investing part of their money in Post Office savings certificates which are state guaranteed. Their capital is secure although the average rate of return after tax comes to just 4.14 per cent a year over 5 1/2 years.

The balance could be invested in a tracker bond where the capital is again guaranteed but they stand to make a higher return depending on the performance of the underlying markets which the product tracks. Another option would be to put the money in a guaranteed capital fund which invests in equities although the capital sum is secure. Typically, these return 70 per cent of a managed fund which does not offer a capital guarantee.