It is time!

atush

If you are thinking of saving around 1200 a month, I would consider putting 100 or 200 of this into a pension. If your family business hasn't already set one up, do so as you will have to in future.

That way the bulk of your money will be going into cash savings for your eventual deposit, but you haven't put off retirement savings when a- they are the easiest to afford as you have the most disposable income of your life, and b-these early pension savings are the ones that have the longest to grow and use the miracle of compound investment returns.

And don't be too cocky about the 'family business' you don't say what type of business it is, but I have seen a number fall in my time. Our 'family' business fell in the late 1920's with many others in the great depression/crash (compounded by insanity caused by venereal disease) lol. And a friend of ours lost his family printing business with the advent of personal computers and printers. Things can change/happen in the blink of an eye.

Good luck with your saving, hope you and the GF will be very happy ;-)

Eco_Miser

Kidsan wrote: »

I would never be out of a job (family businesses), so I don't require security in that way..

I've known family businesses to fail.

Kidsan wrote: »

But as I am in saving terms 'thick' I have only recently found out we all get taxed on our savings on already taxed wages!! So starting from the beginning, when people mention interest saving rate is 8%. What exactly is it 8% of??

It's 8% of the average balance over a year, normally calculated as 8/365% of the daily balance per day.
BTW, 8% is more than double the rate available on anything other than the special Regular Savings accounts, which have very restrictive conditions.

Kidsan wrote: »

Also I read that if it is a fixed year long contract of X% and I had £10,000 in the account I would be earning a high interest rate per month. But they say if I took the money out a day before the year term ended, I would lose the high interest rate. But surely I have taken the £10,000 out plus any extra the interest gained??

That kind of contract usually doesn't allow you to take the money out early, and if it does, specifies a penalty, which will be taken from the capital if the accrued interest is not enough. The high interest may be conditional on you keeping the money deposited for the full term.

gadgetmind

Eco_Miser wrote: »

It's 8% of the average balance over a year, normally calculated as 8/365% of the daily balance per day.

Pedant mode.

As 8% is the AER, you actually need to work out -
1.08 ^ (1/365) = 1.00021087... thus it's 0.021087% per day.

Isn't that a nice little bonus to have every leap year?

Eco_Miser

I was assuming the interest was only paid once a year, and thus for any shorter period the simple interest formula applies. That is, a rate of 0.021917...% per day on a balance which increases by monthly subscription, with no compounding.