Where do I start?

thisisalasdair

I'm putting away £1,000 a month at the moment. This is the first time I've saved properly. I'm at a total loss re: where to put the money.

I bought £1,000 of premium bonds last month (I know, the return is abysmal but with savings rates so poor I thought it would be worth a punt). But where do I look next?

I went to open an ISA with Cheshire but decided not to bother when I heard they were being absored into Nationwide. I just can't decide where to put my money. At the moment it's just sitting in my current account.

Any advice?

saintalan

Hi Alasdair, welcome to the forum.

While you are researching/deciding you might like to make sure its earning something now. I would suggest Santander123 current a/c and/or a Nationwide Flex a/c.

Check out the best savings/regular savings/ISA topics.

You don't say why you are saving, this is important to get the best advice here. For Example, do you have pensions, your age, what is your Tax Rate, saving for a house, timescales etc.

Cheers

Alan

atush

A cash Isa is still a good idea, nothing is happening immediately and you could transfer next year if you don't want to be with Nationwide (but why not I ask?)

Then, after you have 3-6 months spending saved as an emergency pot, you look to longer term goals - join the pension scheme at work (in fact do this now).

Save for medium term goals like a house deposit/future holiday in cash then longer term goals where you can save into S&S isas over cash ones.

kgeerstick

Hello. I am in a similar boat here, Alasdair. I am 31, have been paying debts since I left school pretty much. I am now in a position to save but only about £750-800 per month compared to your £1000, I am a basic tax rate payer.

I am looking at ISA's and Regular Savers too. I recently swapped my current a/c to a First Direct a/c with their £100 incentive and opened one of their Regular Saver a/cs at a competitive 6% AER (you need a FD account to gain the incentive / regular saver interest rate), which works out at 4.8% with tax deducted - you can save max £300 away per month & means you'll get £93 interest over the year. Still better than most ISA interest rates.

The ISA I am looking at is a Regular Saver ISA and pays 2% interest for a year but an additional 1% to regular monthly savers meaning 3% over the year if you stick to their terms and don't miss payments or withdraw any of your money. It pays interest monthly I think. It allows you to put away up to £500 per month away but you have to watch you don't go over the 2013/2014 ISA allowance. It does not accept previous ISA transfers. This is with Newcastle BS and is aimed at those looking to save for a mortgage but the rate is great compared to others available. If a mortgage from NBS is applied for, offered to and accepted by you, they will also offer a cash incentive for holding the account - but a minimum balance applies for this.

I am ready to open one of these ISAs now and think this is the best one for me as I don't have a lump sum to maximise any of the other ISA interest rates but I am wondering whether to do it now or wait until the end of the month in case the interest period is affected. I would put my deposits in on 1st of each month you see but have a smaller amount of money sitting around now.

There is nothing stopping you opening an ISA and a few Regular Savers, or an ISA, a Regular Saver and then buying a few Premium Bonds - the choice is yours really but an ISA is a must to ensure you get some interest tax free.

Good luck!

cloud_dog

Firstly, as atush says get a savings pot.

Then for those of you with regular monthly disposable savings I would suggest you need to look at the Regular Saving rates out there. Gt one, or more of those going, and then at the end of the 12 months move that lump sum into an ISA account and continue with another/more RS.

This all assumes that your net interest on a RS is better than the gross on an ISA.