What best to do with 17k savings?

ukozfr

Everyone has thier strenghths and areas for improvement...money issues represent the latter for me unfortunately! As such, I thought I'd ask for some advice. Basically, I have around £17,000 that I'm not sure how best to save. It is in my current account at the moment and doing nothing for me interest wise. I'm keen to lock it away for a rainy day and would be prepared not to have access to it for around 18 months or so. I've spoke with my bank and they suggested putting around 5k in an ISA (3.1%) and the rest in a bond (2.3% after tax).

Just wondered if anybody could offer any alternatives (e.g. better rates, other options etc).

Any guidance would be greatly appreciated.

psychic_teabag

ISA is definitely a good start. Don't limit yourself to your bank's offerings, though. Rather than locking the rest away, you might want to keep some back for next year's ISA.

The best rates at the moment are actually from current accounts. You could get 3% instant-access from Santander 123 current account. It does have a £2 monthly fee, but you may get that back from D/D cashback. (And I think the higher interest rate alone might cover the fee.)

Or you could split it across 3 Lloyds vantage current accounts - they pay 3% on balances of £3k - £5k.