Whats the best option for me?

Rich_T_2

Hi all,

Im Rich from Uk. Ive just turned 19 and finished college. I have around £250 coming in a week and would like to know about the best savings options for me.

At the moment im using a HSBC current account which offers me no benifits in terms of savings. I would like to keep my current account and have another account for savings elsewhere.

What are the best options? What would be a good ammount to put in to start off?

Any help/advice would be very much appricated.

Thanks

Rich

Rich_T_2

Would really appricaite any advice.

Thanks

grumbler

Good and the easiest option for you is HSBC Regular Saver 8%. When this account matures in 12 months move the resulting balance to some cash ISA.
See Regular Saver link in the blue box above. You can also apply for another current account with A&L and use their 10% Regular Saving account: Alliance & Leicester offers 10% savings on top of current account!

Rich_T_2

Thanks for your post grumbler. I will look into your options.

Ive only ever had 1 account. Are there any drawbacks or negatives having multiple accounts?



Edit: Ive been looking at A&L current account + savings offer. Its swems like a good place to start off. Do I have to select the exact money I want to go into the savings account every month - I would prefer to put whatever money I can in. Also I have no use for credits or overdrafts etc. Is it likely I would be paying to have these features when compared to an alternative that doesnt offer credit for example?

Could you give me some more info on the £100 refer a friend offer, I would be happy to refer you grumbler if you want.

Thanks

Rich

Zebra

For the A & L Premier Direct and Premier Current Accounts you have to be 21.

grumbler

Rich_T wrote:

...Are there any drawbacks or negatives having multiple accounts?

I don't know any besides extra statements every month (depends on account). However, Zebra is right: I forgot that A&L Premium accounts are available for 21+. Sorry.

Do I have to select the exact money I want to go into the savings account every month - I would prefer to put whatever money I can in.

With HSBC Regular Saver you can pay £25-£250 p.m. by a Standing Order. SO is a regular payment, but can be altered whenever you want, usually you must make changes at least 5 days before the payment date.

Rich_T_2

Thanks for replys,

Im thinking of trying the HSBC online savings account.

Am I right in saying, if I put £1000 in the account I would get £50 a month in intrest?

(4.65% gross/4.75% AER paid)

Thanks

Rich

BWZN93

Rich_T wrote:

Thanks for replys,

Im thinking of trying the HSBC online savings account.

Am I right in saying, if I put £1000 in the account I would get £50 a month in intrest?

(4.65% gross/4.75% AER paid)

Thanks

Rich

Unfortunately not! 4.75% refers to the Annual interest paid on the account, which would be £47.50 for the entire year on a £1000 balance. Bearing in mind that you also pay tax on that interest, which is usually 20% if you are a basic rate tax payer.

If you have an ISA however, you can put in £3000 cash in a year (for a mini cash ISA) and you wont get taxed on it. If you for instance, put £3k in an ISA, and withdraw £1000 from it, you cannot top it up to £3000 again within the same tax year, you would need to wait until April when you can put in £3000 again.

There are other options such as bonds which 'lock' the cash away for x amount of time (usually 1, 2 or 3 years) and pay a higher interest rate, but then some of these are taxed too. ISA bonds (for e.g Nationwide's Members ISA bond) are tax free, have a higher rate than ISA's but usually have conditions attached (you must have had an account there for 3years etc).

Ultimately, you need to look at the variety of accounts out there, decide whether you want to lock it away, have to put notice in for withdrawals (e.g 90days) or instant access, and then look at the interest rates for that type of account - and bear in mind whether the interest is tax free or paid net (gross is the interest paid, net is after the tax man has had his share).

HTH

Jo xx

daveonline

Dont forget to clear any debts i.e. credit cards and other debts that may have high interest rates that can be paid into earlier with-out penalty. As at best a good savings rate would be around 5% but not much point if you have say a credit card balance at 28%.
Not saying you have debits but i know i did when i left college.