Newbie saving - what bank?

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ambitiouspanda
ambitiouspanda Posts: 68 Forumite
in Savings & investments
So, every month I put aside between £1000-2000 roughly £1500. Yes, every month I earn about £2500 but I'm living at home with my parents.

Lucky me. At first I wanted to buy ASAP but I think I'm just going to continue saving and hopefully meet someone and buy something together in London. God willing.

So, I'm with Lloyds and they offered me a 2 year ISA with a fixed rate of either 0.5 or 0.05.. Probably the latter ;)

Do any of you home buyers/savers/owners recommend a bank and a type of account?

I'm also opening a another cash ISA 1st Jan once I get the ISA for my mortgage for this year! Until then my savings will just go into normal savings account.

Open to all advice...

I had a target for £7000-9000 savings but life.. :( should definitely save £6000 though.
**2018 G O A L S**
[STRIKE]1) Pay off overdraft[/STRIKE]
2) Pay off credit card by November 2018
3) Begin 2019 debt free and be debt free for the rest of my life!

Comments

  • xylophone
    xylophone Posts: 44,427 Forumite
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    A Nationwide Flexdirect and monthly saver and a couple of Tesco current accounts for a start.

    Have you opened a Help to Buy ISA?Lifetime ISA from next year.

    https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/508117/Lifetime_ISA_explained.pdf
  • Eco_Miser
    Eco_Miser Posts: 4,708 Forumite
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    Generally speaking, you should not have a cash ISA, the rates are terrible and you can earn £1000 in interest before you pay tax on it (£500 for higher rate payers) anyway. If you do have a cash ISA you can usually continue with the same one, no need to open another.
    A Help To Buy ISA is different, the government gives you a big bonus when you buy, which swamps most other considerations.

    Banks, have lots of them, starting with xylophone's suggestions, and continuing with the others listed here. Note that some rates are dropping in January, so that table may be a little misleading.

    Lloyds Bank is currently paying me 4% on over £5000 - you've missed the boat on that but 2% (3% on their regular saver) is way better than that ½% you mention - and 5% is even better (Nationwide, First Direct, HSBC, M&S Regular Savers).
    Eco Miser
    Saving money for well over half a century
  • ambitiouspanda
    ambitiouspanda Posts: 68 Forumite
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    Eco_Miser wrote: »
    Generally speaking, you should not have a cash ISA, the rates are terrible and you can earn £1000 in interest before you pay tax on it (£500 for higher rate payers) anyway. If you do have a cash ISA you can usually continue with the same one, no need to open another.
    A Help To Buy ISA is different, the government gives you a big bonus when you buy, which swamps most other considerations.

    Banks, have lots of them, starting with xylophone's suggestions, and continuing with the others listed here. Note that some rates are dropping in January, so that table may be a little misleading.

    Lloyds Bank is currently paying me 4% on over £5000 - you've missed the boat on that but 2% (3% on their regular saver) is way better than that ½% you mention - and 5% is even better (Nationwide, First Direct, HSBC, M&S Regular Savers).

    I am trying to figure out what bank to go with.. Barclays seems to have a better rate atm.. nationwide want £3K deposit for 2%.. etc.. do you recommend any?

    I don't know if the ISA is beneficial as I would like to save more than £200 p/m. Or should I open up a cash ISA next year on top of the help to buy ISA and save the other half of my money (I usually save £1-2k per month). Opening an ISA could mean I would have £800-1800 lingering around... any advice would be great.
    **2018 G O A L S**
    [STRIKE]1) Pay off overdraft[/STRIKE]
    2) Pay off credit card by November 2018
    3) Begin 2019 debt free and be debt free for the rest of my life!
  • TheShape
    TheShape Posts: 1,779 Forumite
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    ambitiouspanda wrote: »
    I am trying to figure out what bank to go with.. Barclays seems to have a better rate atm.. nationwide want £3K deposit for 2%.. etc.. do you recommend any?

    I don't know if the ISA is beneficial as I would like to save more than £200 p/m. Or should I open up a cash ISA next year on top of the help to buy ISA and save the other half of my money (I usually save £1-2k per month). Opening an ISA could mean I would have £800-1800 lingering around... any advice would be great.

    I have no idea what Nationwide account you're looking at.

    Go back to post #2 by xylophone. Open a FlexDirect account for 5% interest on £2.5k (you must fund this account with £1000 p/m). Open a Flexclusive Regular saver into which £500 p/m can go.

    Do you have a Help to Buy ISA?
  • darkidoe
    darkidoe Posts: 1,125 Forumite
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    You need to read this: Regular Savings account listing all the current top rates for regular savers
    and then
    High Interest Accounts
    and then
    open a HTB ISA as recommended above.

    What rates does Barclays have?

    Save 12K in 2020 # 38 £0/£20,000
  • enthusiasticsaver
    enthusiasticsaver Posts: 15,595 Ambassador
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    Nationwide definitely, both the flex direct and the flexclusive regular saver. You can put a maximum of £2500 in the flex direct and £500 per month in the regular saver. Both of those will give you 5%. First Direct, Hsbc and M and S will also give you 5% although you will have to open current accounts too. Alternatively you could use Tesco current accounts (maximum of 2 I think) which will pay you 3% on up to £3000 each.

    Don't bother with cash isas. The rates on them are terrible. Exception is help to buy isa which gives you free money.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free Wannabe, Budgeting and Banking and Savings and Investment boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
  • Eco_Miser
    Eco_Miser Posts: 4,708 Forumite
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    ambitiouspanda wrote: »
    nationwide want £3K deposit for 2%.. etc.. do you recommend any?
    What account is that? Their flexDirect pays 5% on £2.5k and their Flexclusive Saver 5% on £500 per month -- as you've already been told.
    ambitiouspanda wrote: »
    I don't know if the ISA is beneficial as I would like to save more than £200 p/m.
    So you save more than £200 pm, of which £200 is HTB ISA, and earns a 25% bonus when you buy your house.
    ambitiouspanda wrote: »
    Or should I open up a cash ISA next year on top of the help to buy ISA and save the other half of my money (I usually save £1-2k per month). Opening an ISA could mean I would have £800-1800 lingering around... any advice would be great.
    If you have a regular excess income you want to save, use a Regular Saver account (or two, or three, or six). Accounts on that link total £1300 pm @5%, and another £1000pm @3% or more.

    Only use ISAs if they pay more than you could get elsewhere (all these current and Regular Saver accounts paying over 3%)
    Eco Miser
    Saving money for well over half a century
  • ambitiouspanda
    ambitiouspanda Posts: 68 Forumite
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    enthusiasticsaver wrote: »
    Nationwide definitely, both the flex direct and the flexclusive regular saver. You can put a maximum of £2500 in the flex direct and £500 per month in the regular saver. Both of those will give you 5%. First Direct, Hsbc and M and S will also give you 5% although you will have to open current accounts too. Alternatively you could use Tesco current accounts (maximum of 2 I think) which will pay you 3% on up to £3000 each.

    Don't bother with cash isas. The rates on them are terrible. Exception is help to buy isa which gives you free money.


    I am so excited ! I just opened my Nationwide account online and was accepted! Let the savings begin!!
    **2018 G O A L S**
    [STRIKE]1) Pay off overdraft[/STRIKE]
    2) Pay off credit card by November 2018
    3) Begin 2019 debt free and be debt free for the rest of my life!
  • ambitiouspanda
    ambitiouspanda Posts: 68 Forumite
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    Eco_Miser wrote: »
    What account is that? Their flexDirect pays 5% on £2.5k and their Flexclusive Saver 5% on £500 per month -- as you've already been told.
    So you save more than £200 pm, of which £200 is HTB ISA, and earns a 25% bonus when you buy your house.If you have a regular excess income you want to save, use a Regular Saver account (or two, or three, or six). Accounts on that link total £1300 pm @5%, and another £1000pm @3% or more.

    Only use ISAs if they pay more than you could get elsewhere (all these current and Regular Saver accounts paying over 3%)

    Thank you so much!!! This is so helpful!
    **2018 G O A L S**
    [STRIKE]1) Pay off overdraft[/STRIKE]
    2) Pay off credit card by November 2018
    3) Begin 2019 debt free and be debt free for the rest of my life!
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