income based savings

mydipkit

Hi
I have £90,000 in santander, in an account that pays me about £160 a month interest, but i am now worried about the stability of the bank, what are the top saving accounts that will give a monthly payment?

xylophone

http://www.moneysupermarket.com/savings/search-all/?enquiryId=4148692

See http://www.moneysavingexpert.com/savings/safe-savings
and note Every UK REGULATED account gets £85,000 protection

All UK-regulated current or savings accounts and cash ISAs in banks, building societies and credit unions are covered by the Government-backed Financial Services Compensation Scheme (FSCS). So if the bank fails, you'd get back up to £85,000 per person, per financial institution. The majority should get it within seven days.

You mention £90000 in one account.

heloid

Bar moving everything above £85k somewhere else you have nothing to worry about. Also there is an article on the risks of Santander on this website which should reassure you.
http://www.moneysavingexpert.com/news/banking/2012/05/santander-safety-qa-your-questions-answered

CLAPTON

you're gettin a little over 2% per annmum presumably net so you need an a/c giving 2.7% gross

maybe consider Nortern Rock Virgin at 2.85% gross for the first 85k

Suarez

I would also look for an ISA (Min 3%) and fill that up if you haven't already.

psychic_teabag

Do you need it all in instant access ? In one of Martin's articles, he suggests that even if you need a monthly income, you could put some capital into instant-access and draw income from that (eg say £2k here), and the rest in fixed-term. Then withdraw £160 monthly from the instant-access account. The £88k could then earn enough extra to make up.

eg £90k at 3.17% gives £2853pa
but £88k at 3.60% gives £3168pa

Could tie some for 1 year and some for 2 years, to "ladder". But if this doubles as your emergency fund, you'd obviously want more of it in instant-access.

Fixed-term ISAs tend to allow early access to money, albeit in an emergency, so that might be one compromise between rate and access in an emergency.

Or there are some notice accounts paying slightly better than instant-access.

dunstonh

In addition to provider risk, you need to also be considering shortfall risk and inflation risk if you are using the interest to live on.