Saving, ISAs, Current accounts...!!

SaLi_2 · 6 May 2016 at 1:22PM

Hi all!

I'm at a complete loss at what my best options are - have done my best with research but it's just very overwhelming when I keep having to look up what the terminology means and what I'm supposed to be comparing! If anyone could help, I would much appreciate it...

I have just been given a lump sum of £50,000+ and will not be touching it for about a year whilst I sort the rest of my life out (I'm 24, about to go travelling for 6months+ and have a full time job to come back to). I want to make sure I'm doing the right thing with it whilst it sits doing nothing.

I currently have:

Natwest current account (used to be student, then graduate account) - my main account.
Natwest Credit card (inactive, never been used, but the account is 'open')

Halifax current account (had since I was 11, hardly used)
Halifax online savers account (hardly used)
Halifax Cash ISA saver (used as my only real savings account)

Should I consolidate these accounts to just have one current and one ISA? Then open a Help To Buy ISA then move it into a Lifetime ISA in 2017...?!

I really like Natwest but will move if it's the best option, but would really appreciate some help from some Money Saving Experts!

xylophone · 6 May 2016 at 1:45PM

The best interest rates available are on current accounts - it just depends on whether or not the bank will accept you and whether you wish to go to the trouble of organising the inputs etc.

If you will be leaving on an extended holiday within a couple of weeks then opening various current accounts might just be too much.

You might just consider transferring your ISA to the best rate available, opening an ISA for this year's allowance at the best rate available and depositing the balance in the best savings rate available as soon as possible.

http://www.thisismoney.co.uk/money/article-1583859/Best-savings-rates-General-savings-Internet-branch.html

You would earn some interest and could sort out some better paying accounts on your return.

SaLi_2 · 6 May 2016 at 3:55PM

So you think I should close / transfer my current ISA to a good rate and put in the full amount allowed, then put the rest in a normal saving/current account?

What about doing the same, but the full amount allowed into a help-to-buy ISA with the rest in a saver account, with a standing order to go into the help to buy? (All so confusing - thank you so much for your help!)

xylophone · 6 May 2016 at 4:56PM

Santander offer a HTB at 4% - you could consider it.

http://www.santander.co.uk/uk/isas/help-to-buy-isa

Bear in mind that this would only use a fraction of the cash ISA entitlement and you could not subscribe to another cash ISA in this tax year ( although you could move your existing ISA to a better paying ISA).

Do you have a couple of DDs on your existing Natwest current account?

Do you have time to organise a switch to the 123 Account? You could then set up the regular funding of the HTB and the 123 would pay you a reasonable rate on up to £20,000 in this account.

If you left say £600 in the Halifax account you already have, you could then set up a standing order for £500 from Halifax to Santander and from Santander to Halifax for the same day in the middle of your Santander account month to meet the funding requirement.

CLAPTON · 6 May 2016 at 6:04PM

if you are going travelling I would try out your credit card and see if it works OK
potentially very useful as an emergency source of funds whilst abroad (set up a DD so you never forget to pay

Saving, ISAs, Current accounts...!!

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