Best new regular savings accnt for 16 yr old non-taxpayer?

squink

I'm looking for the best rates for my 16 yr old, still in education - if I'm reading it right, he's missed the cut off for child savings re age (new acct), but not sure if I've understood what I've picked up from trawling this site:
a) Best ISA (Natwest/RBS) at 3.51% - advice given that ISA's best to go for first as equivalent taxpaying savings acct needs to be <4.4%
BUT
b) Best Regular Savings acct: Barclays @ 6% AER - am thick with figures but surely this beats the best ISA into a cocked hat?

Can anyone confirm or add to this?
Thanks

Lokolo

If he is in education I doubt he is paying tax and therefore it does not matter about point a), because he won't pay tax on any savings - be it in an ISA or not.

At the moment normal savings are higher than ISAs so it may be best to open a savings account and fill in an R85 form which will mean the interest will not be taxed (just like an ISA).

Point b) its a regular saver, so if he wants that rate then he will need to deposit a minimum amount each month, otherwise he will lose the rate, so unless he can definately afford to do this, putting it into an instant access savings maybe a better option.

squink

thanks for that - so am I right that by filling out the form he would get the full rate ie. 6% - that looks pretty stunning! This account is particularly good as it doesn't need deposits every month despite being a regular saver - think I may have found a peach...:D

rb10

Just remember that if, say, he puts £250 per month in, he will end up with £3000 at the end of the year. He will not end up with 6% of £3000, as the interest is calculated on the balance in the account daily, so, instead will end up with just short of £100. But you are right that it is an amazing rate, far, far higher than he will get elsewhere.

Lokolo

http://www.moneysavingexpert.com/savings/best-regular-savings-accounts#calculator

^^ put in the figures there to see how much interest he would earn.

Jakg

A&L Premier 21 - 8% up to £1k until July this year atm.

Robert_Sterling_3

squink wrote: »

b) Best Regular Savings acct: Barclays @ 6% AER - am thick with figures but surely this beats the best ISA into a cocked hat?
Can anyone confirm or add to this?
Thanks

Saffron B.S. Reg Sav ISA was 7% last time I looked recently.

squink

Jakg wrote: »

A&L Premier 21 - 8% up to £1k until July this year atm.

Where can I find this? Looked on their website but no mention of it

squink

Robert_Sterling wrote: »

Saffron B.S. Reg Sav ISA was 7% last time I looked recently.

just looked - deal now closed

malik999

squink wrote: »

I'm looking for the best rates for my 16 yr old, still in education - if I'm reading it right, he's missed the cut off for child savings re age (new acct), but not sure if I've understood what I've picked up from trawling this site:
a) Best ISA (Natwest/RBS) at 3.51% - advice given that ISA's best to go for first as equivalent taxpaying savings acct needs to be <4.4%
BUT
b) Best Regular Savings acct: Barclays @ 6% AER - am thick with figures but surely this beats the best ISA into a cocked hat?

Can anyone confirm or add to this?
Thanks

I would put the money into an ISA even though the interest rate is lower at this moment in time. He will thank you in years to come. Once you lose his years ISA allowance its gone forever, he can never get it back.
I wish I had been more aware years ago.

Kavanne

You should consider an ISA so he can start building up his tax free savings pot so that when he IS a tax payer he has more money that is already tax free