First post: Saving/Investing ideas wanted

somebloke_2

Having been reading quietly here for some months, I thought that I would register to see if anyone had some good ideas of what savings/investment ideas might be worth me taking a closer look at. Particularly in light of the current climate I thought there might be some opportunities out there.

I have about £5k sat in a "high" (their words not mine) interest account at the moment that I can relocate with minimal notice. This is in excess of what i need day to day. At a push I could go a little higher.

I have cleared all non-mortgage debt over the last few years. I have a cash ISA that I am up to the year's limits on. We have a baby on the way in a few weeks time and this is money that I have put aside for that, but don't anticipate needing for at least 12 months (I hope! First Baby, so who knows!!).

I was thinking about opening a cash ISA for my wife and moving the maximum in to that now, leaving the rest where it is. I could then hopefully top up one or both ISAs come April.

I wondered though if anyone had some good suggestions for making the money work a bit harder over a 12-24 month period. Given our situation I don't want to go too far out on a limb with risk at the moment, but don't mind a bit of a punt with some of these funds.

Any creative ideas?

somebloke_2

Probably should have said: Mortage is fixed at 6.1% with nationwide for another 18 months. Can overpay on this by up to £500/month without penalty, which does provide another option.

I *believe* that I can they underpay again by up to the overpayment if circumstances change later on, so this is possibly a more flexible option than it originally seems.

So, I suppose I am thinking:
a: Use the wife's ISA allowance (it's all joint money anyway) and leave the rest in general savings.
b: Overpay on the mortgage
c: Something completely different.

All suggestions welcome.

a7man

You already know what you are doing... ISA & early repayment of mortgage are your best options. You shouldnt put any money you need in the near future (next 5 years) into funds as they fluctuate too much in the short term, especially now.

If you are a basic rate tax payer you could get a fixed rate bond for 1-2 yrs.

You could leave some money aside to put into at stocks & shares ISA if you believe you wont need it in the short term.

somebloke_2

Thanks A7. It's sometime just nice to have an outside opinion to confirm that you're not just missing something obvious.

Plan as of 2pm today (likely to change again) is...

1. Take advantage of current grants to get the walls at home cavity insulated. Price after grant = £150 inc VAT. If prices keep rising the way they are at the moment I reckon I'll have that money back in a year anyway (not to mention the benefits of not being nagged about a cold house!).

2. Make 4 over-payments of £500 each on the mortgage

3. Change my regular payment to a £100 over payment after that. Probably just let it reduce the minimum payments for the future, but maintain consistent payments in order to give maximum flexibility.

Main reason for this approach over the additional ISA is that I reckon we're much less likely to "dip into" funds if we have to borrow it back from the Mortgage company rather than just withdrawing it from savings.

Unless anyone can see a big flaw in this I think that is what we'll be doing.

a7man

Yeah its a good idea to get out of debt first as long as you have enough emergency savings if something goes wrong. Risking large amounts of capital for growth while also having a mortgage over your head is only for the brave.

If your wife is a non tax payer it will give you other options too as she wont pay any savings tax. Its def worth taking out an ISA in her name in the future too (if she is a tax payer).

somebloke_2

Tax paying at the moment for her, but she's about to finish work for at least 6 to 9 months - maybe more depending on how things work out. That'll change things.

Speaking of change... new plan. I have to buy her a dishwasher as well !

a7man

I thought you said you had a wife? Jokes...

somebloke_2

Now you see- jokes like that could really spoiling my plans. Being self employed I wouldn't be earning much if she found out and had me laid up in hospital !