approx £70k to save, which account is best?

ben2444

If I sell my property I could have 70k cash in equity. I will either buy another property and let it out or just put the money in an account and live off the interest while I go travelling with a bike and tent for possibly 6 months.

Which type of account is best for this sum of money? Obviously I'd prefer instant access to my money but I am open to advice, Thanks

[Deleted User]

AA's telephone bonus saving a/c

5.25 %


(first 6 months)

whiteflag_3

ben2444 wrote:

If I sell my property I could have 70k cash in equity. I will either buy another property and let it out or just put the money in an account and live off the interest while I go travelling with a bike and tent for possibly 6 months.

Which type of account is best for this sum of money? Obviously I'd prefer instant access to my money but I am open to advice, Thanks

I have the same problem , Im thinking of selling up and getting the wife/kids to live with the mother in law so hopefully will have £100 k net for saving. Any ideas?

FLEX24

If the M-I-L lives far enough away, do it!! :rotfl:

whiteflag_3

FLEX24 wrote:

If the M-I-L lives far enough away, do it!! :rotfl:

Only 3 miles - is that far enough?

charlieboycat

With £70k or £100k, best gross rates at moment seem to be AA 5.25% (phone a/c) or Cahoot 5.25% (internet a/c). Both are "instant access" in terms of no notice required - but neither have cash cards. You have to withdraw by BACS transfer to a current a/c. For those who are travelling the method of operation (phone v internet) may be important. I would use either phone or my own laptop when travelling, but not an internet cafe.

Also important if you want to live off the interest - Cahoot has a monthly interest option, but AA does not (it is annual interest only).

In either case you have to remember to close the a/c after 6 months and put the money into whatever a/c then has the best rate on offer.

YorkshireBoy

charlieboycat wrote:

For those who are travelling the method of operation (phone v internet) may be important. I would use either phone or my own laptop when travelling, but not an internet cafe.

Everyone on these boards seems to rave about the Nationwide debit card for withdrawing spending money whilst abroad.

Another option to requiring internet access whilst away might be to "pre-load" a Nationwide account with the proposed "spending money" likely to be needed whilst travelling, and put the rest with Cahoot or AA.

All the OP then needs to take with them is a Nationwide debit card.

Locket_2

Hello

I'm new, please be gentle!

At the end of this month I will receive a £10K redundancy payment :T I want to invest the lump sum (probably long term) and wondered if any of you knowledgeable people know where best to put it, or should I offset it against my repayment Mortgage (5.3%). My mortgage stands at approx £37K and my lender doesn't impose any penalties for overpayment.

Thanks!

charlieboycat

Locket

If you don't need, and won't need, the cash then repaying a lump off the mortgage is effectively earning you 5.3% net of tax - equivalent to 6.625% gross (assuming you are not a higher rate taxpayer). A nice rate to be earning (better than you will get in any savings account).

Even better, if you have or can swap to the right sort of mortgage - namely an "offset mortgage" (ie. one against which you can offset savings and only pay interest on the net difference) - reap the earnings benefit but still be able to take the cash should you need it at a later date.

Caped_Avenger

Locket,

I'd echo what charlieboycat has said, but one thing you've said does raise an issue. you said you want to invest it "probably long term". Regardless of this, the most sensible thing you can do, in terms of interest, is to offset the money against your mortgage.

If you have a repayment mortgage that allows overpayments of that size, then you can do this as a lump sum. This is where the "probably" comes in.

Just how likely is it that you'll need access to it again? If you're on a capital repayment mortgage, it may not the easiest thing in the world to get the £10K back, although not impossible.

If it is quite likely you'll want to use the £10K, an offset would be easiest, since you've got the cash in a savings account, and can access it (almost) instantly. If you've got the right sort of offset.

The question is whether you can handle the temptation of being able to draw back against it!

Robert_Sterling_3

Pay some off your mortgage