New to Saving

mardiemare2008

I am 24 and have recently managed to pay off all my debts (including a £1250 Student overdraft that was maxed out).

My next aim is to save for a deposit to buy a house (aiming to buy in 2016), and just generally get as much cash behind me as possible just in case. After my monthly outgoings i have around £450 spare per month.

I have started to make some savings plans and I just thought I would share them.

These are the accs I currently hold and what I am planning on depositing in them each month.

House Deposit £250 - Nationwide Save to Buy ISA

Car Maintenance - £30 Nationwide Regular Savings (Interest Rate Shockingly Low & may need to do something about this)

None Specific (instant access required)- £100 - YBS -Internet Saver Issue 3

Premium bonds £50

I also Currently Invest £55 per month into an Employee Share Incentive Plan. (this allows me to buy one share, and get 2 free - to a max of 6 free shares a month) This will mature in 2016 as I joined the plan in 2011

ColdIron

I wouldn't bother with Premium Bonds, there are better places for your cash and the minimum investment is £100

mardiemare2008

I already hold £100 in premium bonds, but was planning on investing £50 per month by standing order.

ColdIron

Ah yes, according to the T&Cs -


41. Bonds may be purchased in multiples of £1. The minimum purchase at any time is £100 (one hundred £1 units). Purchases made by cheques for less than £100 will be returned to the applicant.
42. Where the purchase is made under the Regular Purchase Scheme (see paragraph 38) the minimum is £50 (fifty £1 units). If any purchase is for less than £50 it will be returned to the Bond holder’s bank in full.

mardiemare2008

I have just realised something...
My 'Car Maintenance' fund I am only intending on paying £30 per month into interest is 0.10% if I pay in £30, but 1.35% if I pay in £100 per month.

My YBS account pays 1.25% (I was planning on paying £100 into this one.

Would I be right in saying it would benefit me to switch the standing orders of these two accounts? Pay £100 to Nationwide and £30 to YBS to maximise interest??

Archi_Bald

Have you already got a Nationwide FlexDirect current account? 4.89% gross a month for a year. Looks a better place for your savings than anything else.

mardiemare2008

Archi_Bald wrote: »

Have you already got a Nationwide FlexDirect current account? 4.89% gross a month for a year. Looks a better place for your savings than anything else.

No, My current account is with RBS - I am thinking about switching banks soon; however if I were to switch to Nationwide and keep any money I saved in my current acc I think it would be too much temptation for me to spend.

I need to have different accounts that are difficult to touch to make my savings plans sucessful

Yorkie1

I don't think you need to switch accounts to use the flexdirect - just use it as a savings account and make sure you deposit £1K each month (can transfer it back out again straightaway).

Archi_Bald

As Yorkie1 said, just use the FlexDirect as a savings account, and keep using your RBS account as before.

FlexDirect pays you something like 3 times as much interest as your YBS account does, and the funds in your YBS account are no more "protected" from yourself than funds in a FlexDirect.

mardiemare2008

Unfortunately I do not yet have a spare £1000 to transfer in. My wage that goes into my RBS is in excess of £1000, but my DD dates are set for the same day I'm paid (so it goes in and the majority goes straight back out).

It may be an option when I've saved up, but as I'm still at the start of saving it'd be impossible to do at the moment.

Archi_Bald

You do not need any spare £1K. You just need to pay in £1K during each calendar month. You could, for example, do this by shuttling £200 between your RBS and the FlexDirect once a month manually. Should take no more than 5 minutes, and less if you can make it £2 x £500.

Stop trying to keep yourself from getting the best interest!