Realised house equity - where to go with it?!

Ah_forget_it

Hey folks, a bit of a newbie to the forums here, though have been receiving the mails for a while. Just wanted to pick peoples brains on savings though as our circumstances have changed.....

We have been extremely fotunate to sell our house recently and are having a major life change moving out of the smoke in London down to the west country. We have an amount to save as we will be renting when we move down until the market picks up and I just wondered what advice you would give as to where to save this money? I'm not particuarly keen to invest in any stocks or shares as I won't be investing long term.

We have around 60K spare, I have a full cash Isa for this year but my wife has none so the maximum will go in to that. She will be giving her job up and will become a full time mum. I'm concerned as I will be earning £50K that I will be a higher rate taxpayer for all the savings accounts so am I right in thinking it should all go in to my wifes name to save?

Does anyone have any other reccomendations though for the remainder? Do you think we should look to tie up my money for a year and get a better rate with a term product or keep it flexible to buy a house if the market starts to turn? Anything specific people think might get the best return?

Many thanks in advance for all your reccomendations!

isofa

I'd probably keep most of it in instant access just in case.

Best rated accounts listed here at Moneyfacts.

Kaupthing Edge are offering 6.55% instant access on-line.

Much better to put it all in your wife's name, re the tax situation. In fact if she isn't receiving any other income, the interest on 60K will be well under her personal tax allowance for the year, so she could elect to receive the internet gross, rather than taxed at 20%.

60K at 6.55% gross = £3930 interest
60K at 5.24% (after 20% tax) = £3144 interest.

If you do want to tie it up for a year in a fixed rate account you might be able to get nearer 7% gross, but you'll not have access at all for 12 months.

debbie42

If your wife is below the tax band it makes sense to have it all in her name to minimize tax liabilities. (I'll try and avoid the mandatory "watch out for lots of new handbags shoes etc.", whoops, I didn't ) MAke sure she fills in an R85 form for each account.

I'd very much doubt that the housing market will be on the rise within 12 months, so would consider term deposits for some of it. You can get 7% + with Kaupthing, among others.