£20,000 savings best option?

rodrigues_2

Hi, im new to this site, and it appears there are a number of super intelligent financiers among us... hoping for your help.

ive got £20000 to put towards a deposit for a house in the near future - 2 to 6 months. Presently the £20000 is in a Bradford and Bingley savings account, which has instant access - though i havent utilised this option.

I was wondering whether there might be a better account to save this money, i have been looking into the glut of information on the internet, but am unsure about internet only bank accounts, similarly i need to have access to the money in the near future (2 to 6 months), and therefore dont want to tie up the money in a non-access account.

hope this makes sense!! basically, have £20000, which accounts do you think would see best returns?

many thanks.

cadboll

Hi!

Although it is a sizeable sum of money, the fact that you want to be access this money within 6 months, this rules out accounts with good rates but require the money tied in for a longer period of time.

The e-savings accounts offered by a number of providers might be your best option. I have been using internet only accounts for a couple of years and never had any problem with them at all.

As to the best rate available check out the section on this site - http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1098730527,15721, - as you are likely to be needing the money within 6 months, it might be worth considering an account that offers monthly interest (although I might be proved wrong here!) First Direct are offering 5% Gross/AER but don't give interest in the month you withdraw money. Some people have had bad experiences with them, but I have found them to be ok.

Newcastle Building Society is also offering a decent rate. These are options worth looking it. I hope this is of some help.

P.S. Just checked your current rates at B&B:
- Annual interest: 4.85% gross p.a., 3.88% net p.a., 4.85% AER
- Monthly interest: 4.75% gross p.a., 3.80% net p.a., 4.85% AER

It all depends on how long you will have the money in the account as to whether you would see the benefit of increasing the rate by 0.25%.

rodrigues_2

many thanks for your advice. perhaps on reflection i'd be just as well to leave the money where it is, considering my need to access it in the near future.

thanks for the info!