New to saving - advice please

helmster

Hi all,

first post, so hello to everyone.

I am fairly new to saving. Having graduated 4 years ago, i've been working away, buying a house, developping my career and slowly but surely paying off my student loan and am about to wipe my credit card debt out. Hence I'm now in a position where I can begin to save some cash.

I have a ISA which which is in it's first year and will soon be up to it's 3000 limit for this tax year.

I work in a commision based job, so every so often, I get a nice lump sum, albeit these payments are different amounts and always regular. I want to know what I should be doing with it next considering I will be to my limit on the ISA.

I am guessing I should open up a high interest instant access account and dump my commission into that. Then I can drip feed into a regular savings account and then when April 6th comes round, dump another 3k into my ISA.

Have I got this right or should I be doing something else ?

Can you recommend me some accounts to do this with (high interest instant access & regular savings account).

Finally mY Isa is a Halifax ISA Saver Direct - can I be doing better than that, and if so how do i go about transferring to another account without losing my interest ??

Many thanks for any help.

ReportInvestor

Hi Helmster & welcome to the site .

That sounds about right.

Coventry First @ 5.35% is great for s/os into the regular savers. It requires £1K pm funding. It doesn't offer a cheque book but it does have a cheque withdrawal facility which you could use at ISA time. Unlike other high interest current accounts there is no significant upper limit (eg £1K or £2.5K) on the amount attracting the decent interest rate.

Your next stage might be regular saving into the stock market. It sounds like you might be on the way to becoming a higher rate taxpayer, and if so the share ISA route would be the way to go for that as you wouldn't have to pay extra tax on dividends.

The Halifax ISA Saver Direct pays a competitive 5% but you can transfer it to another provider eg National Savings 5.3% or Kent Reliance BS 5.21%. Ask your new provider for a transfer form and they will complete the process within 30 days.

Don't close your Halifax ISA yourself or you will lose the tax free benefits for good.

Top paying regular savers which don't need a current account at that institution include:

Ipswich BS 8.25% (£250pm max)
Britannia BS 7.5% (£250pm max)
Halifax BS 7.0% (£250pm max)
Yorkshire BS 6.5% (£500pm max - I like this one as it continues past 12 months)
Principality BS 6.5% (£500pm max)

Dead_Eye_Jones

plenty of other places to invest, but it all depends on the risk you are willnig to take on. I also used up my stocks/shares ISA allowance a few years back, has gone up almost 50% in the last 4yrs but at time it was 50% down. As a relative youngsters we might be willing to invest some money in more risky options as over the course of our lives we should have a good opportunity to exit on a high and stick out the lows.

Id say a pension is a good one to check out if you arent already contributing? The earlier you set this up the better, a few years sooner now can make a difference of 1000s when we get to retire (prob age 80 at this rate!). My cash goes to pension/ISAs/Mortgage. I quite like the idea of being mortgage free so that's my priority even if my fixed rate is now lower than some saving accounts!

Its up to you really; shares, property, fine wine, saving accounts, gold, orange juice, whatever, prob best to speak to an IFA if you arent willing to do the research yaself.

TBeckett100

National Savings offer a better rate on the ISA about 5% for new subscriptions but not on transfers. have a look on moneysupermarket.com

Always keep a few months living expenses in the bank and do cash Mini ISAs when you can. If saving for the med to long term, have a look at other tax free investments on the National Savings Website, then look at Stocks and Shares ISAs and so forth.

helmster

Ok, many thanks guys - this helps.

Reportinvestor and Deadeye, you both make reference to becoming "a regular saving into the stock market/share ISA route would be the way to go for that as you wouldn't have to pay extra tax on dividends/stocks/shares ISA allowance"

I do own a few stocks in one company who i got a tip for, but apart from that, know very little about how share ISA's work. Could you put me in the direction of where I can learn more ?? Do I need to research specific stocks to buy into these ISAs or can I buy into a fund type set-up ?

Tbeckett, you say "do cash Mini ISAs when you can." - what exactly do you mean by this ? (Sorry, I did say i was a bit of a newcomer to this world !)

ReportInvestor

You can buy funds within a shares ISA wrapper.

Find out more about them on https://www.trustnet.co.uk

https://www.fool.co.uk is a good place to learn about investing in both funds and individual stocks.