Planning for an "influx" of money

Froom2

Hi people

My OH has got a job!!!!! wheeeee! ((I'm not sure if this is the right bit of the forum for this post, but I posted here before :S let me know if I should go elsewhere)
And on top of that, I just got a promotion!!!!

OH and I already discussed how we will manage money when he is paid, and how he is going to repay what he owes to various people, but I was wondering, on my side of things, how I should manage my money myself.

I'll elaborate.
I'll have more money than I have ever had in my life. I'm not complaining!!! And although it's not much compared to some, I'm still feeling a little intimidated by it.

My current plan, after the bills are paid (half from him and half from me) is to put half of what is left after that into my ISA (until I reach the allowance), and aim to have at least 500 as a buffer in my e-savings at all times. Does that sound about right?
What do I do with the rest? Should I put it into the e-savings and let it build up there until I see something I want?

What do people actually do with all this money? :S

I love saving, but what do I do after I reach the ISA allowance?

Is there somewhere I should put it while I save up for things like the rug I want in my bedroom? Obviously I don't really wanna take money for things like that out of the ISA... the ISA is kinda in my head for saving up a house deposit.

~Froom~

londonsurrey

Does your mortgage allow overpayments? That can be a good optional place to put funds while you think about things.

Froom2

No mortgage we rent (at a very cheap rate - 300 a month!)

londonsurrey

Oops, just saw you don't have a house yet. Please ignore the mortgage query!

londonsurrey

Froom2 wrote: »

No mortgage we rent (at a very cheap rate - 300 a month!)

Wow. At that rate, it might be worth staying there and buying a property just to get the rent!

JodyBPM

It's hard to know how much money you are talking about, but I'd initally save to the ISA allowance each, and split the excess into long term savings and "budgeting savings" (eg to cover car breakdown, new washing machine, household emergencies etc). I'd want *a lot* more than £500 in the budgetting savings account tbh, perhaps £2-3K.

Set yourselves each a sensible amount of "spends" each too - DH and I have £200 a month each for social life/clothes/coffees/mags/frivilous spends etc.

Enjoy the extra money, but make sure you use it wisely! Saving for a house deposit seems like a lovely goal!

londonsurrey

Froom2 wrote: »

Is there somewhere I should put it while I save up for things like the rug I want in my bedroom? Obviously I don't really wanna take money for things like that out of the ISA... the ISA is kinda in my head for saving up a house deposit.

~Froom~

There are savings accounts that allow you to make only one or two withdrawals a year, without incurring any penalty charges. This might be ideal for saving up for big purchases that happen a couple of times a year.

Froom2

Well I worked out that after bills (inc food), I will *in theory* have about 600 spare a month. I can't even imagine that much x_x And if I take 200 for frivolous things, that's still 400 left over!

I really like the idea of the savings that allow one or two withdrawls, I'll have a look into that next week for sure - would be great because then it's really special money for things I've saved for.

Would you recommend opening a joint savings account too? For the 'budgetting savings' you mention, Jody? Would that be like a joint version of an e-savings?

Froom2

londonsurrey wrote: »

Wow. At that rate, it might be worth staying there and buying a property just to get the rent!

It's pretty rough around the edges, but yeah it's a bargain And a superb landloard along with it, who even offered to look after my hamster if we go on holiday! Hehe.

Desperado99

Froom2 wrote: »

I love saving, but what do I do after I reach the ISA allowance?
~Froom~

Look around and consider savings bonds (where you lock your savings in for a set period for a fixed interest rate)

Or possibly a regular savings account where you get a better interest rate for paying money in each month (and the more money you pay in the higher the rate)

We tend to (although this years not going well savings wise ) get the regular savings up to a certain amount and then transfer it into a bond.

Well done on your new jobs :T

JodyBPM

Froom2 wrote: »

Would you recommend opening a joint savings account too? For the 'budgetting savings' you mention, Jody? Would that be like a joint version of an e-savings?

We use an e-savings account for that, - easy to xfer across to the current account if we need to buy a new dishwasher or pay a large, unexpected bill etc!

Based on £600 a month extra, I'd put £200 each into an ISA, £100 into the e-savings, and have £100 for frivilous spends. Then just watch your savings grow!