Are Premium Bonds best for my situation

Person_one

I'm new to this particular board, so hello!

I have a reasonable lump sum I need to put somewhere. I am about to be unemployed but won't need to break into the lump sum for living costs. I want to hold on to it until I've been in a new job for a few months and can use it as a deposit for a property.

The problem is I don't know whether this will be in 6 months or 3 years! There seems to be little point putting my money in a high interest account where it would be locked away for at least a year in case I want access to it sooner and then lose that interest. The interest in instant access accounts is pitiful, I get 0.2% at the moment!

So should I get Premium bonds, and sacrifice a tiny bit of interest for no interest and a slim chance of a win? According to Martin's Premium Bond calculator, with the amount I have there's a high probability of at least a £50 win in the first three months which I'm fairly sure I wouldn't make in interest in that time!

Any thoughts welcome and appreciated.

lilac_lady

I'd put the money into premium bonds as you can get it back quickly and interest rates are so low for instant access saving at the moment. Hope you get lucky!

sleepless_saver

Person_one wrote: »

So should I get Premium bonds, and sacrifice a tiny bit of interest for no interest and a slim chance of a win?

Depends on how much of a gambling instinct you have;).

But you don't need to languish on a 0.2% rate of interest. The top instant access account is currently paying 2.8% which is better than the premium bond winnings you might reasonably expect.

Lokolo

http://www.halifax.co.uk/savings/websaverextra.asp

There is this account. If you can deal with losing 30 days interest when you withdraw the money.

Reaper

Lokolo wrote: »

http://www.halifax.co.uk/savings/websaverextra.asp
If you can deal with losing 30 days interest when you withdraw the money.

1 withdrawal a year is free, so if you keep the money in there until you need it then take it all out there is no penalty.

Old_Wrinkly

And if you open a Halifax Reward current account and fund it with £1000 per month (Unemployment Benefit/JSA?), then the rate for the WebSaver Extra goes up to 3.0%*.
And you'll get £5 pm as a 'Reward' (interest) on the current account.
(Note: the money to fund the current account can be in lots of separate amounts and doesn't have to stay there.)

* For 12 months anyway - who knows what the state of Halifax's accounts will be in 12 months time, with all this Lloyds' malarky.

Person_one

Old_Wrinkly wrote: »

And if you open a Halifax Reward current account and fund it with £1000 per month (Unemployment Benefit/JSA?), then the rate for the WebSaver Extra goes up to 3.0%*.
And you'll get £5 pm as a 'Reward' (interest) on the current account.
(Note: the money to fund the current account can be in lots of separate amounts and doesn't have to stay there.)

* For 12 months anyway - who knows what the state of Halifax's accounts will be in 12 months time, with all this Lloyds' malarky.

Thanks for the info on the Halifax account, I'll look into it. As I don't have a job right now though I don't think I could manage 1000 a month to get the higher interest rate!

debbie42

You can put in £500 twice, if you have somewhere else to move it to/from?

JohalaReewi

Person_one wrote: »

Thanks for the info on the Halifax account, I'll look into it. As I don't have a job right now though I don't think I could manage 1000 a month to get the higher interest rate!

You don't actually need £1000 a month in income. You just need to pass £1000 a month through the account and it doesn't have to be in a lump sum.:beer: