What to do with £500....

Any

I would hide it for safe keeping in separate account cash ISA.
I have one with Virgin money (used to be Norther Rock) and I only look at it occassionaly. That is my completely "anything can happen" fund, it was first savings I started ever. Now I have funds ISA as well and regular saver in view, but this one is online only, need separate access, which I don't carry with me..
Then I also have small SO set up to go out the moment I get paid to there and once in a while I look at it (twice a year) and do a little dance surprised how much money there is (there isn't, but given the small contribution that goes there it is).

I don't know why I feel like that, but I think because it was my first ever stab at savings and I started with so little I like that one more then my other savings... It's like a pet:-)

It is the only account I could use immediately in case of real emergency... investments can be down at the time, regular saver would loose interest... but here I could dip if... I don't know... my OH broke a leg while skying and I had to fly out to be with him and all my credit cards got refused:-)

But I cannot look at it too often, otherwise I would get the feeling I have enough to cover such an emergency and spend it:-)