New to savings

Cherry_Bomb

With so many different savings accounts out there I'm a bit confused by it all.

We've got some extra money coming in and want to use it to build up a deposit on our first home.

We can afford to save a minimum of £2000 each month. At the minute I've just got a regular savings account with the Halifax which I've had since I was 16. This months money I've transferred in so there's £2000 just sitting there. Is there something better I could be doing? A better savings account? Investment?

Any advice welcome!

xylophone

Why are you and your partner not using your cash ISA allowance?

Cherry_Bomb

xylophone wrote: »

Why are you and your partner not using your cash ISA allowance?

Honestly?

I didn't know there was an allowance....

Is this a certain amount then I can put in an ISA?

innovate

Have a good read through the savings section on the main site http://www.moneysavingexpert.com/savings/

calypso_rhapsody

Look at ISAs and at the regular savers - make sure you review the rates of any accounts at least annually (keep a list or a note in your diary of when bonuses expire).

Also think about Halifax reward accounts (a sole one each and i think you can also do a joint account). If you pay £1000 a month into this (even if only for a few minutes), the Halifax pay you £5 pm (net of 20% tax). That works out to a fab rate of interest but it is taxable whereas interest in ISAs is not.

kidmugsy

How long are you prepared to tie some money up for? If two years seems about right consider this ISA:
http://www.cambridgebs.co.uk/savings/cash-isas/cambridge-2-year-tracker-isa

You'll see that if interest rates rise you'll earn more interest on that ISA.

Be sure to keep some money available on instant access without penalty, to cope with the unexpected. (Note that if you want to withdraw money from that Cambridge ISA you need to give 120 days notice or you lose 120 days' interest on the amount withdrawn.) One neat way to do that is to open a VANTAGE current account with Lloyds TSB - it is an ordinary current account but pays good interest on your balance.


I'm a local customer of the Cambridge and have always found them very good.

kidmugsy

Here's the thread for regular savings accounts. Remember that 4%p.a. interest less standard 20% income tax is equivalent to getting 3.2%p.a. tax-free in an ISA.

https://forums.moneysavingexpert.com/discussion/608697