Where to put my hard earned cash?

XEO25

Hi all, before I ask my question, I'd just like to say thanks to all the regulars on this board. I'm a long time watcher, but a newbie poster.

Since reading these boards I've decided to take stock of my life and rather than moving into a £600 a month posh appartment with my girlfriend next month which we had planned, we've decided to stay put paying £320 a month in our not so nice flat.

This will free up about 200 a month and I want to start saving for a deposit for a mortgage. Where is best to put my money? I don't want/need to dip into it for the next 3 years.

Thanks

LucyTheDwarf

Hello!

Have you used up your ISA allowance yet? If not, that's the first place to start, as you will earn tax free interest. The ISA best buy table is here http://www.moneyfacts.co.uk/savings/bestbuys/mini-cash-isa.aspx. or here, if you want a fixed rate http://www.moneyfacts.co.uk/savings/bestbuys/fixed-rates-isa.aspx. Bear in mind that introductory rates, such as the Barclay's Tax Haven ISA having a 1% bonus, could mean you need to switch accounts in a year, due to it becoming uncompetitive.

If you manage to save more than £3600 in any year, go for the current best buy on and instant access savings account. Instant access so you can transfer the balance without penalty on 6th April, into your ISA, as this is where you'll earn the most interest.

XEO25

ive never had a savings account before, just a current account. no ISA's or nothing like that.

I currently bank with Barclays, which of there ISA's shall I apply for? the tax haven one or the cash isa? I think i'd save about 1500 in a year, possibly 2000