Savings question with a difference.

Chrisw_3

Hello all,

Just after a bit of advice really. I am about to leave my job and will be starting a University course. This University course pays me 15k (ish) per year, tax free, directly into my account. This is a post-graduate course.

I currently have about 6k to put into some sort of savings account but just wondered what would be the best option? I intend to save around 500 pounds a month from the payments from this course.

Sorry if this is vague, not sure what other information you would need!

Many, many thanks for your help.

[Deleted User]

First read this.

Next, how long can you lock the 6K away for?

< 1 year = ISA and easy access savings account(s)
> 1 year = NS&I Index Linked Savings Certificates

For regular monthly savings read this.

Chrisw_3

Deleted_User wrote: »

Informative post

I read those guides before I made the post, didn't want to be a total noob!

Basically, I have 8k ish to save *now* for just 1 year, and then I will be attempting to save around 500 a month from my income.

I guess I just got confused as my 'income' will be tax free, and wondered whether this made a difference to the best type of saving.

Thankyou for your post.

[Deleted User]

Chrisw wrote: »

Basically, I have 8k ish to save *now* for just 1 year

I'd invest that in the NSI savings certs then. Read this for further Q&As.

Chrisw wrote: »

and then I will be attempting to save around 500 a month from my income.

Fill a cash ISA then regular savings account then I'd say.

Chrisw wrote: »

I guess I just got confused as my 'income' will be tax free, and wondered whether this made a difference to the best type of saving.

Read this

In short:

Non-taxpayers' note

The non-taxpayers' fountain differs slightly as there's no cash ISA tax gain. Yet potential future taxpayers should still consider them as, if you open one now and don't withdraw the money, the interest should still be tax free by the time you start paying tax. It's a good preventative measure.

For those who won't ever pay tax, the fountain should start with a Regular Saver as the interest is highest. After that pick a cash ISA or savings account depending on which pays more.

Remember the rates on all these accounts will change. It's worth checking every six months or so to see if there's a higher-paying equivalent.

savemoney

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