money from house sale

grannyflat

I wonder if anyone can help me to get the best 100% safe return on the proceeds of my house sale. I will be renting for a few months while I find a property in Scotland and need the interest to pay the rent. Funds are just over £1,000,000. Tell me more about "the money markets"

Stubod

If you want "safe" then you will need to go with the best interest savings accounts.
Usuallyb start with an ISA as this is tax free. Also recently relaunched NSI index linked, but if there is only one of you this will only be a home for £5,300 odd in ISA, and £15,000 in NSI.
Next "safe" option is the best savings account you can find. Currently about 3.1% in Northern Rock.

Try "moneysupermarket.com" website as these list all the best options depending on youir needs, (ie instant access, monthly interset etc).

Stu

xrjtg

You probably weren't referring to these, but there are things called "money market" accounts, and you should avoid them.

The biggest issue you have if you're very concerned about safety is that deposits in banks are, in the official worst case scenario, only covered up to £85000 per institution. One completely safe option is to deposit your money with NS&I, who are backed by the Treasury. The downside is that their instant access account pays 1.75%, which compared to the best payers is likely to cost you around £12500 (before deduction of tax) over the course of a year.

Finally, you say you want the interest to pay rent: I wouldn't get too hung up about having the interest credited to you monthly. You'll achieve the same result, and have fewer restrictions on the types of accounts you consider, if you get an account paying yearly interest and just withdraw however much you need for rent each month from the account.

plunt

often with that sum of cash you can call up places like barclays wealth and so on and they will give you a private interest rate. make them work to get you as a customer!!!

xrjtg

plunt wrote: »

often with that sum of cash you can call up places like barclays wealth and so on and they will give you a private interest rate. make them work to get you as a customer!!!

Be careful not to let them persuade you to do anything exotic. If you need the cash to buy a house, you need the cash to buy a house. Don't let them tell you anything different.

plunt

xrjtg wrote: »

Be careful not to let them persuade you to do anything exotic. If you need the cash to buy a house, you need the cash to buy a house. Don't let them tell you anything different.

yep ofcourse couldnt agree with you more! just be specific you want instant access or maybe 30/60 days notice. and set interest with no gimics or gambles. just make sure you shop around. friend called nationwide and apparently their account are slowly being emptied out as savers dump their money into the new ns&i bonds. so the customer definitely has some power now. use it to your advantage!

stringer_bell

plunt wrote: »

often with that sum of cash you can call up places like barclays wealth and so on and they will give you a private interest rate. make them work to get you as a customer!!!

Have they been known to do that? Do you think they'd beat NR 3.1 percent?

plunt

offshore they definitely do. and for private wealth management onshore it wouldn't surprise me

dreverie

I'm in the same position. I want the money for my next house to be 100% safe (government guarantee) not 99.9%. NS&I income bonds look good as they are guaranteed by the government. But the money needs to be transferred in and out via you own bank account. So, for large sums you're exposed as it flows through your normal bank (maximum protection £85k/£170k for single/joint accounts).

The messy alternative is to open multiple bank accounts and put £85k/£170k in each.

I'm still looking for better ideas if there are any.