Best thing to do with my £3.5k savings...

SteveCutler

I have approx £3.5k in savings, currently sitting in a Barclays Tax-Haven ISA at 3% interest (unsure if this has dropped further after yesterday's 0.5% cut, their rate online is still the same).

It seems to me that the only real way to better that interest is by having a fixed bond which pays up to 4.65%

Trouble is, I don't really want a fixed bond (or at least, not for more than 6 months) - because I may well be spending some/most/all of the money during this summer. Then again, I may not. It's really undecided as of yet.

With regards to tax, I'm currently a student studying A-levels, so I don't pay tax until September of this year.


Basically, I wondered if anyone has any ideas which I could do with my £3.5k? The very least I'll be doing is switching my ISA provider in April.

I'm open to consideration for anything - I've been thinking if buying shares is worth it - though due to it possibly being only for 6 months, I don't think it will be a good investment in that case.


Any ideas are much appreciated, thanks! :money:

Lokolo

6 months on shares in extremely risky and doubtful you will earn anything.

You are studying A Levels... doesn't mean you don't pay tax. You just aren't earning enough.

Are you not going to university?

If not, if you are going to go into fulltime work then you will more than likely pay tax and therefore you should keep your ISA so that it keeps earning tax free interest, whereas the savings will drop when you are a tax payer.

SteveCutler

Lokolo wrote: »

6 months on shares in extremely risky and doubtful you will earn anything.

You are studying A Levels... doesn't mean you don't pay tax. You just aren't earning enough.

Are you not going to university?

If not, if you are going to go into fulltime work then you will more than likely pay tax and therefore you should keep your ISA so that it keeps earning tax free interest, whereas the savings will drop when you are a tax payer.

Sorry yes, I meant studying for A-levels being the reason for not being in employment, hence not earning enough to pay tax...

I won't be going to university, shall (hopefully!) be in employment.

Thanks for the advice. Looks like I'll just switch my ISA then (my Barclays one is on a 1.5% first year bonus) in April.

Lokolo

Ah good, I'm sure you knew about tax but I always make sure just in case

If you pay 20% tax, do savingsrate * 0.8 to find the actual rate. So the 4.65% would go down to 3.72% which is even closer to 3%. Hopefully when rates start to rise again ISAs will become better and you will earn more money that way.

SteveCutler

Lokolo wrote: »

Ah good, I'm sure you knew about tax but I always make sure just in case

If you pay 20% tax, do savingsrate * 0.8 to find the actual rate. So the 4.65% would go down to 3.72% which is even closer to 3%. Hopefully when rates start to rise again ISAs will become better and you will earn more money that way.

Fingers crossed!

My economics/business teacher has a 6.25% fixed ISA which he took out a while ago, I still have a lot to learn :rotfl: