What to do with £1000?

miksu101

I am a 19 year old student in Scotland, and, unlike the sterotypical student, I did not spend all of last years grant/loan on nights out. Because of this, I have managed to save £1000. I know its not that much, but if I do not do something with it soon I will end up spending it on other rubbish; a ps3 looks quite tempting at the moment...
So. The question is, how should I invest/save this to get the most out of it?
I was also thinking, RBS tells me with my student account I could get an interest free overdraft of up to £2500... which could then give me more to invest. I dont mind not having access to my cash for a couple years, as I will be getting more come September each year for the next 3 years.
Any suggestions?
any advice will be greatly appreciated
cheers!

amcluesent

>The question is, how should I invest/save this to get the most out of it?<

Spread betting is the only way to get significant gains with such moderate starting capital.

> could get an interest free overdraft of up to £2500<

Borrowing to invest? Hmm, only for private equity gurus IMHO.

debbie42

amcluesent wrote: »

>
Spread betting is the only way to get significant gains with such moderate starting capital.

You are kidding, I take it? This is the "savings and investments" forum. There is a "gambling loopholes" forum on here, which can make money by matching bets, but not without some (minor) risk and effort, and certainly not by gambling or spread betting!

amcluesent wrote: »

>
Borrowing to invest? Hmm, only for private equity gurus IMHO.

Ok, so now I know you are kidding. There's plenty of people who "stooze" on here, without being private equity gurus!

If you are getting an completely interest free loan, then max out the loan and stick it somewhere paying a decent rate of interest. There are plenty of good savings accounts around at the moment. See the stickys at the top. Just make sure you don't get tempted with the ps3s.

Depending on the OPs tax position, maybe an ISA would be a good idea?

plonkee

I would suggest putting £3000 in total into a mini cash ISA. The money is there when you need to pay off the overdraft when you graduate and it will make cash on the side. At 6% interest (tax-free) it'll make £180 in the first year.

If you are a non-tax payer then you don't need to stick to an ISA but can pick the savings account with the highest headline rate of interest.

This all has the advantage of capital guarantee and safety because its reasonably likely that you will want to spend some of the money when you graduate - and if you don't you'll be in a better position to make more long term financial decisions.