Best way to save

WackyJacky_2

Hi Guys,

Im not sure if I come to the right place but I have the following to ask you great guys:

I finally pay off my debt this year and decided to start saving in January, so far I can see I/we incl. my partner can save about £400 per month.

Do you guys know which way is the best way to save? is the high interst savings account a good idea or an ISA?

You only can put in up to £250 in an high interest account, do you think I can have 2 high interest account?

And also my partney is self employed would that be a problem with his tax bill?

I know there are loads of questions but any advise would be fantastic.

Thank you


WackyJacky

CLAPTON

if you are a tax payer then it make sense to save in an ISA as its tax free... you can each save up to 3,600 in this tax year

I see no problem with your partner tax position with savings and in any event ISA don't need to be decalred.

[Deleted User]

Hi,

I'd suggest the following:

1. Generally ISA's are a good place to start:

http://www.moneysavingexpert.com/sav...gs-without-tax
and http://forums.moneysavingexpert.com/....html?t=401374

2. Regular savings accounts are good too:

http://www.moneysavingexpert.com/sav...vings-accounts
and http://forums.moneysavingexpert.com/....html?t=608697

Regular savings accounts are generally a good place for new money e.g. monthly pay cheques, however if for example you have £3k in a 6% high-interest bank account drip-feeding into a 10% regular savings account then you're essentially getting 8% interest on average for your £3k which beats most fixed rate products - albeit with a bit more work.

3. If you want something with a little less work then fixed rate savings accounts are a good option:

http://www.moneysavingexpert.com/sav...interest#fixed
and http://www.thisismoney.co.uk/saving-...&in_page_id=50

4. One other thing you might like to consider is getting a decent instant access savings account:

http://www.moneysavingexpert.com/sav...st#topaccounts
and http://www.thisismoney.co.uk/saving-...&in_page_id=50

5. Finally if you're a higher rate tax payer then NS&I's 3 and 5 year Index Linked Savings (http://www.nsandi.com/products/ilsc/index.jsp) look good, paying 1% above the RPI inflation rate. Currently this is 5.0% so that’s a rate of 6.0% overall.

The attractiveness of these is that the savings are tax-free meaning it's better for higher-rate taxpayers. Basic rate taxpayers would need to earn 7.5% in a normal savings account to match this, while higher rate taxpayers would need a 10%.

One thing to note is if inflation drops then so does the rate for these savings. It'll always be higher than inflation and tax free though.

collingwood21

I would go with the cash ISA to start with - get your interest paid free of tax! If you go over your ISA limit for the tax year, then start looking at other high interest savings options. If you think you are going to need access to your money quickly in future, then go for an instant access ISA.

WackyJacky_2

Thanks for your replys, i think i go for a instant access ISA.

Can anyone recommend the best instant access ISA? I know i can search on the internet but Im very clueless about these kind of things.

Lokolo

Barclays have a 6.08% monthly (making 6.25% per year).
HSBC have an e-ISA which is 6.25% from what I can remember.
Egg have their ISA at 6.05%