Spread of Savings - Critique Required

mark99

A relative has savings spread around which have increased largely recently due to house sale. These (below) are the holdings.

She wants to keep savings for about 18 months before buying another house. Any critique welcome of the savings strategy. Any better accounts? Attitude to risk = nil so no shares.


You can see ICELAND has featured however money has been recovered and put into other accounts. Some holdings are >£50K and as such may be at risk.






Birmingham Midshires £67K

First Save £1

NSI ISA £20K

EGG £1

Kaupthink Edge £1

Citibank £0

Heritable Bank £0

Tesco £47K

Alliance and Leicester £48K

Icesaver £0

Northern Rock £64K

Lloyds Reg Saver £6K

Premium Bonds £1K




TIA

Markus

Reaper

Only 2 accounts are over £50k. Northern Rock you don't have to worry about and even the BM I wouldn't be overly concerned about, although the official line is to keep it below £50k.

I haven't looked up all interest rates but the NS&I ISA jumped out at me - their rate is pretty rubbish, you can get almost twice that if you transfer it to the top payers.

rb10

Premium bonds too - they may only form a small part of her savings, but the rate is dead low, and will fall further on December 1st.

Stonk

With quarter of a million in savings, a grand in PBs is fine. For a flutter, at least, as I'm sure the poster realises it is.

Medium term, it would make sense to reduce the BM exposure below £50K.

You might as well close the Kaupthing and other dead accounts. Unlikely to become competitive again, and it will save you admin time!

Just a thought for you:
I've got a fair stash in BM at the moment, and I'm fully expecting their rates to go down soon because they haven't yet reflected the 1.5% cut in base rate. I'm talking about the eSaver, here. I'm going to move some of the money into their internet-based fixed rate offerings (5.75% for 6 months, and 5.60% for a year). Although that would presently be a reduction in interest rate, I think in the long run it will be better. I've done this before, and you can make deposit directly from the eSaver with no loss of interest by phoning them up and requesting an internal transfer.