21 with £13000, what should I do with it?

Hi everybody,

I have been saving like mad these past few years and taking full advantage of the bonuses I have been getting. I have managed to save up just over 13k. I am wondering what should I do with it? At the moment its just in my Santander savings account earning me 0.1 percent of interest. I know something needs to be done with this money. I do want to get a house when I am older but at the moment my basic is only 20k and I don’t think I am going to be able to get a house just yet? Any help on what I should do with this money would be great, thank you.

Andrew
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Comments

  • le_loup
    le_loup Posts: 4,047 Forumite
    What have you thought about and researched so far?
  • Stevie_Palimo
    Stevie_Palimo Posts: 3,306
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    It depends on the area where you live and the value of houses within it, If you want to buy in say 2 years or maybe 10 years.

    Lets say you have a plan to buy within 3-4 years then a first time buyer ISA may suit you here and also place some other money into the TSB accounts or NSI accounts.
  • enjoyyourshoes
    enjoyyourshoes Posts: 1,093
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    Help to buy or lifetime isa?

    S&S ISA?

    Pension top ups (SIPP)?

    Regular savers some still offer 4-6%, set a number running at staggered intervals and keep renewing them?
    Debt is a symptom, solve the problem.
  • stoozie1
    stoozie1 Posts: 656 Forumite
    Regular savers some still offer 4-6%, set a number running at staggered intervals and keep renewing them?

    I thought all the previously 6% regular savers had reduced to 5%?
    Save 12 k in 2018 challenge member #79
    Target 2018: 24k Jan 2018- £560 April £2670
  • le_loup wrote: »
    What have you thought about and researched so far?

    I did look into stocks and shares and opened a Lloyds shares account but I got a bit scared and decided to close it down. I have no idea what to invest in and I would probably be reduced to tears if I lost my money!

    I live in Bournemouth so house prices are quite expensive round here. You can maybe get a flat for around £120,000 and houses are £200,000+. I just didn't think I would even be able to get a mortgage on just earning £20,000 a year. A few people have told me that it comes down to what you are earning and the deposit doesn't really help you when it comes to how much you can borrow, only affects the rate of which you'll be able to borrow the money?

    Good shout about the Help to buy and Lifetime ISA's, I will look into them now.
  • xylophone
    xylophone Posts: 44,140
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    Open a Flexdirect with Nationwide - open Flexclusive monthly saver?
  • I just didn't think I would even be able to get a mortgage on just earning £20,000 a year.

    I got one and I earn £17k a year, so I think you should be able to get one earning £20k.
  • ViolaLass
    ViolaLass Posts: 5,764 Forumite
    Of course you could get a mortgage on £20k, the question is of how much.
  • bertiewhite
    bertiewhite Posts: 1,904
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    If you can get on the property ladder, it doesn't need to be anywhere fancy or big - I'd think anywhere is likely to be a good investment long term.
  • macman
    macman Posts: 53,008
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    edited 20 April 2017 at 9:51AM
    0.1%?! While you are thinking about long term investment, move that £13K into a Santander 123 account, which will pay you 1.5% up to £20K. That's 1500 percent more interest than you are currently getting.
    To save £13K by the age of 21 is a great achievement, but to leave it languishing on a rate where it is actually shrinking (with inflation) is just plain daft.
    As suggested above, a LISA or Help To Buy ISA is really a no-brainer-what other investment is going to give you a 25% bonus each year? But unfortunately you're now too late for the 16/17 allowance.
    With £13K available, you could in fact invest in both the above ISA's and a SIPP as well for 17/18. (£4K, £2.4K and £2.8K respectively). Total £9.2K. Then put £2.5K into a Nationwide Flex Account (5%).
    http://www.moneysavingexpert.com/savings/lifetime-ISAs
    No free lunch, and no free laptop ;)
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