Loan I'm not using right away.. can I do something to make more cash?

minikarter

Soo the deal is I'm a student, and I have received a Career Development Loan from Barclays to help pay for accomodation until September 2011. It's to be payed to my uni in 3 instalments of about £2000 each, and right now, after I pay my first instalment today I'll have £4.5k sitting in my account.

The options are, I could either pay off my accommodation in one lump sum right away. OR is there something I could do with the money in the meantime to earn some kind of interest on it or something?

The next 2 instalments won't be until January and April, so i've really only got about 5 months in total as I only received the money yesterday.

Any ideas? If not I will do the safe option, get it out of my sight and just pay the lot.

Thanks

Kohoutek

Yeah – just find the highest paying instant access saving account (in the "banking and saving" tab) and put it in there.

opinions4u

Stick it in an easy access savings account.

Check out what your own bank offers for convenience, or look at things like:

Nat West 2.89%
Halifax ISA 2.80%
AA 2.80%
Tesco 2.60%
ING 2.75%
Halifax Web Saver (1 withdrawal) 2.60%

minikarter

ok, But how is it worked out on a monthly basis? say a bank gives 2.9% AER, will it give that per month or just a fraction of that?

If it's only going to be worth £50 or less then I'd rather not worry and just send it off to Uni.

opinions4u

minikarter wrote: »

ok, But how is it worked out on a monthly basis? say a bank gives 2.9% AER, will it give that per month or just a fraction of that?

If it's only going to be worth £50 or less then I'd rather not worry and just send it off to Uni.

Well, if you can afford to throw money away, that's fine by me. But why would you?

Interest will be calculated daily. So £4,500 saved for 150 days will pay:

£4,500 x 2.9% x 150 / 365 = £53.63 to a non-taxpayer.

minikarter

Ok, is there anything I should watch out for on these? I'm new to savings accounts but they sound extremely simple. Kinda makes me nervous there's something I'm missing!

Lokolo

It might take 3 working days to come back into your current account so when your acc. bill comes in, make sure you withdraw the money around a week in advance.

Other than that, thats pretty much it.

minikarter

Thankyou everyone! I've opened an esavings account with Natwest, had a guy answer lots of questions and talk me through the application through a chat box on my screen!

Thanks for the help