Best place to invest £200K

Chichi_2

Need to invest equity from sale of property to give me enough to afford to rent a house. It's about £210K, how much will I get a month gross? Where's the best place to put it? I can have a notice account up to 30 days.

losgiganteskid

If your over 50 Northern Rock silver saver is the tops

Chichi_2

I'm under 50.

losgiganteskid

Chichi wrote: »

I'm under 50.

Your lucky then !!

dunstonh

You dont want to invest it but use savings accounts by the sounds of it.

Depending on what your plans are for the future, that could be a bad move as the cost of living will soon eat into it. Plus you say gross interest. £210,000 would have around half the interest taxed assuming you dont have a penny of other income.

jamesd

See the best savings accounts article and check for the availability of monthly interest. Icesave does monthly and currently pays 5.95% equivalent to 12495 gross a year or 1041 a month. 832 net of basic rate tax.

You won't be able to honestly complete a gross interest declaration unless you're planning to do this for no more than four months, since after 5 you've exceeded your personal allowance even if you've had no other income this tax year.

Assuming no other income for the whole year, with tax deducted from the interest, income tax of about 1855 would have been deducted and you'd have overpaid 310 during the year that you'd be able to reclaim.

[Deleted User]

dunstonh wrote: »

You dont want to invest it but use savings accounts by the sounds of it.

Depending on what your plans are for the future, that could be a bad move as the cost of living will soon eat into it. Plus you say gross interest. £210,000 would have around half the interest taxed assuming you dont have a penny of other income.

Hi Dunstonh - Can you please explain why £210,000 would have half the interest taxed. I thought tax on investment interest is 20%, and if you don't have any other income, you can offset your personal allowance against it.
Thanks

cheerfulcat

But the gross interest on £250,000 is roughly twice the personal allowance...

[Deleted User]

cheerfulcat wrote: »

But the gross interest on £250,000 is roughly twice the personal allowance...

Agreed - but what is your point?

[Deleted User]

He is assumming that OP is working and thus there is a high chance this will push the OP into the 40% boundary because return on saving is clasped as income so if you earn 37K a year and get 6K of interest, 3K will be taxed at 20% and the other 3K will be taxed at 40% assuming the 40% boundary is 40K. If this is the case then have a look at NSandI stuff particularly the RPI tracker. Obviously make use of your ISA allowance. If you can rent a room in a shared house as this is far cheaper then renting a house.

cheerfulcat

[quote=[Deleted User];5326539]Agreed - but what is your point?[/quote]

My point is that even if there is no other income, half of the interest will be taxed. As dh said.