Saving £30k

Spiggle

Hi,

I'm helping a friend at the moment trying to get her funds put where they make most money for her. I've got the ISA side sorted out for this year and will do the same for post April.

What I have far less experience of is something that is instant access (won't go into details but she has to have the assurance of being able to get at it quickly) savings. There is £30k available to invest.

There are brilliant lists and advice on the ISA threads, is there something similar here please? I'm willing to trawl to find something for her but thought you knowledgeable people may already be on the case. No point re-inventing the wheel!

I have a feeling (fear maybe) that her particular requirements are going to mean pitiful rates but I though it worth asking the question.

Any ideas very gratefully received and thanks in advance.

All the best,
Spigs

psychic_teabag

Sorry, not quite sure what you're asking. You have 30k to put somewhere instant-access - are you looking for something other than the best-buy instant-access savings account ?

Of course, "quickly" may mean different things to different people. May want to split that in a few different pieces - in increasing rates of interest...

1. some under the mattress - instant but low return
2. A savings account with a cash card is 24-hour access
3. A nearby branch account is office-hours access.
4. A postal account is a few days access
5. A notice account is weeks or months access time (though some allow instant-access with a penalty)

Using an online instant-access account should give interest around 3% but allow transfer 24/7 to 2 or 3.

Could put £5k into a Lloyds vantage current account : gives a cash-card like 2, but interest rate is comparable to best online savings accounts. Need to mess about a little to get that rate, but nothing complicated. There are other current accounts that pay better rates on lower balances - check Martin's guides for details.

Note that there seem to be fixed-rate ISAs which allow early access with penalty, so if some of the ISA money is in one of those, that may reduce access requirements on this pot a little. (Non-ISA fixed-term accounts tend to disallow any early access.)

Will your friend be happy to move the money (at least once a year) to chase the best rates ?

Or maybe you didn't mean savings account - eg investing it in, say, unit trusts and things still allows withdrawal any time, but amount can go down as well as up.

Spiggle

Thanks psychic teabag,

Easily get at-able is the definition I think! I have been looking at the best buy instant access on the main site. I suppose I thought maybe someone would have some other ideas but it is a hard market I know. Any of the best buys listed would be better than the current pitiful interest she's currently getting!

She won't 'invest' it in something and I'll be very lucky if I can get her to tie any of it into fixed rates unfortunatley. I think I'll just have to make do with getting her ISA pot filled up again and again after April and just get her the best buy instant access.

Sorry if my original post was a bit obscure! Thanks very much for answering, very much appreciated.

All the best,
Spigs

jamesd

Regular savers combined with other accounts can be useful. Say the 8% from First Direct for £300 a month for a year.

psychic_teabag

I also forgot to mention to look out for NS&I certificates when the next become available - depends on view on inflation etc. They are instant-access, but don't pay any interest if cashed in during the first year. Since they're tax free, they're better value the higher the rate of tax paid.

There's also premium bonds, but not really considered a good investment here.

Spiggle

Thanks jamesd,

I managed to get her into a reg saver last year and that's now maturing and will get her another for the forthcoming 12 months. I will also try to encourage her to have more than one i.e in more than one company. I'm with FD and think it's the best deal going but my friend is 'happy' where she is in terms of her bank/current account and so won't switch! 'Pulling teeth' is what I call it!

She is such a sensible person in every other way but lets a huge (well to me anyway) amount of money stagnate earning 0.1% or 0.5%!

Thanks psychic teabag, I hadn't thought about NS&I certs, I got a load for one of my GDs last year but they'd closed before my GD2's account had matured. If they open up again I will try to get some of my friends money shifted to there.

She does have times when she's completely 'closed' to doing anything but she's 'open' at the moment so I need to strike quickly to maximise her investment within her constraints.

Thanks again, I really appreciate your time and thoughts.

Take care,
Spigs

theoretica

I would second the mention of the Lloyds vantage accounts- get her two or three (I think they allow you three?) with £3k to £5k in each and direct debits set up to swap £1k between them once a month and she will have instant access and 3% interest.

Eco_Miser

£30,000 could be earning £900 a year, @3%. Try comparing that to what your friend is actually getting, it might be a better spur than talk of percentages. I'd also support getting a few Lloyds Classic with Vantage current accounts - instant access plus a good rate. You'll find plenty of threads on the subject (mostly from when it was paying 4%) if you search.

ajbell

theoretica wrote: »

I would second the mention of the Lloyds vantage accounts- get her two or three (I think they allow you three?) with £3k to £5k in each and direct debits set up to swap £1k between them once a month and she will have instant access and 3% interest.

You can just open a Lloydstsb Incentive saver which pays the same 3% instant access but without the limits and hassle of swapping £1000 backwards and forwards each month.

jamesd

No need for her to switch, she can just treat it as another savings account.

Spiggle

Thanks Eco Miser, I did that yesterday and I think it had an effect. We're working on it today so hopefully it will all be sorted by tonight, fingers crossed!

Thanks ajbell, I'll look at that now before she arrives. I was looking at the Birmingham Midshires easy access account which is also 3% but its good to know there are other options at that rate. Although the Nationwide is a slightly higher rate I know that having to open the card account would seem like too much faff for her or in her words 'too confusing'!!!

I like the option of her getting FD account and the reg saver there as well (she's with HSBC and pays!!! for her account so can access the reg saver there at 8% with a lower maximum on the monthly amount). At some point I will find the right way to explain to her that the fee she pays negates any earnings!

You mean the Lloyds account jamesd?

Thanks all very much for your help and thoughts, very much appreciated.

Take care,
Spigs