Cheery's buttling diary: tea in one hand, plant pot in the other, running shoes on

Chocforever

A lurker pops out to say that your 0.25% illustration isn't quite right because there is 20% tax deducted at source from the interest and I suspect you earn too much to get any of this refunded.


Interest is tax-free with an ISA. It is possible to get an instant access ISA so I don't think there is a downside in switching to an ISA.

Cheery_Daff

:wave: hi chocforever What a fabulous name

And thanks for pointing out my dodgy maths :rotfl: Ah well - the general principle still applies!

Just been reading this about pensions - it says take the age you start to pay into your salary, take half of it, and put that % of your pre-tax salary aside every year til you retire :eek:

For me that would be 17% :eek: but actually I already put 7.5% away automatically before I get paid, and it says to include employer contribution which for me is 16% - so that might well mean I have to do nothing else at all :j :rotfl:

(except stay in this job til I retire... :eek: )

Cheery_Daff

Gosh I'm having a right old education today

I pay £176 out of my wages each month for pension (£2112 a year) - which apparently adds £596 a month (£7152 a year) to my pension :eek: Worth doing then! (assuming they don't change the rules in the next 40 years, that is...)

Karmacat

Definitely worth it! Cheery, this is great to read! Its all about empowering yourself - and just because you've never had any savings (though you must have had, if you had an isa once upon a time :rotfl: ) is no reason not to make the best of them now that you've got them.

Brilliant news you found on your pension ... and more savings now will give you more choices later on! You're being watchful of your money, but you're not depriving yourself, so why not save? You might be able to retire years before the retirement age, and as you say, the retirement age when you get up there will be utterly horrendous.

Way to go, Cheery :j:j:j

Cheery_Daff

Hmm yes, you're right about having something to put in an ISA at one point of course... :rotfl: Wasn't much though, and it was more saving for a few months so I could have time off between jobs at end of PhD than longer term stuff, but even so...

Will definitely have a think and a shuffle, thank you all!

Cheery_Daff

Ok, more investigating, tis fascinating this stuff when you get into it, thanks KC! :j (well, when I say 'fascinating'... )

Anyway, been investigating regular savers. I'd rather go with an ethical place if possible (which limits my options already - which makes things MUCH easier :rotfl: )

Some options...

* Tridos do an online cash ISA at 1.4% AER, 2 year fixed rate for 1.8% and 3 year fixed rate for 2% (Although reluctant to commit - who knows what'll be happening then?!)

* Tridos also do a fixed regular savings account (which you have to pay into each month) at 1.76% AER (which I think I'm right in thinking works out less than the ISA....)

* I've already got an account with the local credit union - but can't find ANYTHING that says whether it pays interest or dividend and how much - have emailed to find out (I think there's £50 in there at the minute)

* Just remembered I've got an account with Cheshire Building Society from when I was a kid so went to investigate - and it turns out they've merged with Nationwide... I think I had a letter but since it's got less than £5 in it I ignored it Nationwide do a regular saver with 2.5% AER - apparently the rate is variable and depends on the overall increase in the balance, not the total amount in there (??)

(ah, on further investigation... interest paid monthly so if you put in £500-£1000 in a month, you get 2.5% for that month (which is 2% net apparently). If you only put in £200-499, it's 1.85% (or 1.48% net). Likely I'd manage £100-199 a month, so 1.35% (or 1.08% net))

Am I boring you yet?! :rotfl: :rotfl:

So, according to :money: the regular saver has to pay 1.7% AER (or more) to beat 1.4% in an ISA.

rtandon27

Cheery_Daff wrote: »

...Am I boring you yet?! :rotfl: :rotfl: ...

Nope!

Next best thing after a good list is a good bit of number crunching!:D

Cheery_Daff

Right, so let's say I go with Tridos...

* ISA is 1.4%, online only (which is fine), unlimited withdrawals but 33 days notice

* regular saver is 1.76%, online or post, you can only pay in ONCE a month, and only two withdrawals a year (again 33 days notice).

I'd be more tempted with the ISA I think!

HOWEVER - currently pondering how much to stick in it... I can't see us ever needing access to a big wodge of cash with no notice?? If we did, the bills account could fund probably up to £1000 until we'd withdrawn from here... Until I'm used to it I might feel happier with leaving say £1000 in the instant access thing just in case? What do other people do??

Right, that's enough thinking about that for tonight - I'm off to doze off in front of Kojak :j

Cheery_Daff

rtandon27 wrote: »

Nope!

Next best thing after a good list is a good bit of number crunching!:D

:rotfl::rotfl::rotfl::rotfl::rotfl::rotfl::rotfl:

I might have known that round here!! :rotfl::rotfl::rotfl::money:

Just looking at the Nationwide one again...

Maximum starting balance is £1000, and interest rate goes up depending how much you save in a month (with 2.5% on increases of over £500 a month). So theoretically I could start off with £500, then add £500 every month to get the maximum rate (then I *think* Martin suggests wanging the whole lot in an ISA the week before the new tax year starts to make sure it gets put away tax free for the future, even if the rate is slightly less)...

(so I'd lose all the interest for that month I suppose because balance would have DECREASED rather than increased?)

Then I could carry on bunging in £500 a month for the rest of the year (interest is accrued monthly but paid annually)

Weirdly, you can do unlimited withdrawals, but online you can only do them to another Nationwide account, which I don't have, so it'd have to be cash (£500 a day) or cheque (£500,000 a day :rotfl: )

Possibly what might sway me against this one is that there's a maximum balance of £5 million - just might not be adequate for my needs :rotfl::rotfl::rotfl::rotfl::rotfl::rotfl:

Cheery_Daff

Hmm - but does withdrawing everything and losing an entire month of interest take you below the rate at which it's better to have it in an ISA all along??

And is my poor brain so frazzled by all this that it's best to keep it simple and go with the straightforward option (Tridos ISA) rather than messing about with remembering to transfer bits in April??

In which case, back to the original question (well, one of the many original questions) - how much to put in there and how much to keep in the instant access thing? And when I'm adding my £200 a month in the coming year, is it best to put it in the ISA? (yes, I think so!)

Gosh, I really AM going to stop now... :rotfl: