Treasury Bills, which are issued once a week by the Government as part of its financing programme, can be bought in denominations from £15,000 upwards.

They are generally issued for repayment in 91 days and pay their interest rate to the purchaser in the form of a discount on the price. These bills can be bought and sold at any time up to redemption. Local authority bonds and bills, with different maturities and different denominations are similarly available.

Commercial bills (issued by companies as part of their trade financing) are available in much larger denominations, and certificates of deposit can also be dealt in from £150,000 upwards.

If you have enough spare resources or want to keep a large amount of money in liquid form for a while, then it is advantageous to use the money markets. But do consult your bank or other professional adviser, and do stick to the reputable names.

Also make sure you find out what commissions or charges are being made on the lump sum - normally the banks do not charge commission but may take their turn by offering you a fraction of a percentage below the current interest rate.

There are also a number of unit trusts available now with the object of investing in the money markets. Details of these can be obtained from the press or from your professional advisers. Remember that in the money markets, the return is almost always in the form of income rather than capital gain.

CCMG - 2013