How much can you save?

Happy New Year to all "How much can you save" members :j

miss_angie1 wrote:

As I have just proudly received my debt freedom

Congratulations! :j

miss_angie1 wrote:

I have calculated that we can probably save around £300-£400 each month and was wondering the best way to do it.

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The advice I have read so far is that I should focus on building up my Mini ISA first so will work towards getting £3000 saved by 5th April.

Does anyone have any advice on how best to approach it?

Here is my advice:

The standard savings accounts that you've got don't have the best savings rates on the market, but since you don't have much capital right now there's no point opening a better one. As you are aiming at saving regularly each month, a LloydsTSB regular saver is definitely for you.

Whilst this doesn't have the market's best rate for a monthly saver (it pays 8% AER - still high relative to "standard" savings accounts), it has by far the most flexible offering (and lasts for two years, not one), making it ideal for your situation:

Both you and your OH should open a LloydsTSB monthly saver. You will both require a Lloyds current account, I guess you already have one. If your OH doesn't, he needn't "switch" to Lloyds - he can just open a current account, put £1 in and leave it alone.

You need two monthly saver accounts as the maximum you can pay into an account is £250 in a month.

You should pay your regular savings into the Lloyds monthly account, one lump sum payment each month - the amount is allowed to be different each month, but you're only allowed one payment per month and it must be between £25 and £250. When the account is first set up, Lloyds will create a standing order from your Lloyds current account to the monthly saver, but you can go ahead and cancel that and pay your savings in however you wish.

You are allowed to withdraw money from the monthly saver whenever you like without penalty, but you are not allowed to pay any withdrawals back in.

In April (probably better go with end of March, just to make sure you don't miss the deadline), transfer as much of the savings as you can into your ISA.

Continue paying regular savings to Lloyds, and in March 2008, open an NS&I ISA (assuming they're still the best - it's difficult to imagine anything better coming along), and transfer savings from the regular saver into the new ISA .

Hope that made sense - good luck with the savings!

Thanks Mr H. I'll get onto opening that regular saver asap and save as much as poss for transfer to the ISA. When April rolls around will I have to transfer my current ISA to the NSandI one? Is this a straightforward process?
Oooohhhh I'm so excited at the prospect of actually being able to save!! It has been such hard work clearing my debt but well worth it. 2007 is going to be a great year I can feel it.

Hey all, mind if I join too?

I've been trying to focus on my saving over the last six months or so, but after receiving one big financial hit after another (bought a car, then my computer decided to fry itself, then had to MOT the car etc etc) they're back down to pretty much the level they were before I started! So - New Year, new savings!

I've currently got a Lloyds TSB Classic account (awful, awful account, I know, but I only use it for clearing my wages and paying my bills, I don't allow loose sums to hang around in it!) with around £1000 in it (I'm expecting some bills to hit soon).

Savings account is an A&L Online Saver @ 5.15%, so relatively competitive until March, when the rate drops. Will be switching then.

No ISAs at the moment, though I'm planning to open a Mini Cash one when my Christmas funds clear.

Fingers crossed!