Premium Bonds

jimjames

bryanb wrote: »

I want one of those accounts!!! 12.5% Fantastic!!!

FireWyrm wrote: »

Think you missed the meaning but I agree an account paying 12.5% would be awesome.

Yes you can get that. 12.5% is the effective gross amount on £1000.

£50 gross from TSB at 5%
£75 gross from Halifax

Total £125 on your £1000 by moving it between the 2 accounts. Interest rates are not as low as some people think if you are prepared to put a bit of work in.

jimjames

powertron wrote: »

Which accounts are these? TSB and Halifax have really low interest rates.

Don't know where you're looking but tsb is the highest paying account available at 5%

powertron

jimjames wrote: »

Don't know where you're looking but tsb is the highest paying account available at 5%

I'm looking on TSB and Halifax and not seeing anything that gives £125 guaranteed from £1000.

eskbanker

powertron wrote: »

I'm looking on TSB and Halifax and not seeing anything that gives £125 guaranteed from £1000.

It's a bit of sleight of hand - Halifax pays £5 reward per month regardless of how much money you leave in the account (it's not interest) and this is net, so grossed up is £6.25 per month, i.e. £75/year. Meanwhile TSB pays 5% gross interest, therefore £50/year, so by keeping the money in TSB for practically all of the time (other than briefly bouncing it into and then back out of Halifax), you get both the TSB interest and the Halifax reward from the same £1,000, therefore a gross £125 return on it.

bryanb

jimjames wrote: »

Yes you can get that. 12.5% is the effective gross amount on £1000.

£50 gross from TSB at 5%
£75 gross from Halifax

Total £125 on your £1000 by moving it between the 2 accounts. Interest rates are not as low as some people think if you are prepared to put a bit of work in.

Thanks for the clarification, but the OP is asking about £500 to £700 per month.


If you put £1000 to work as you suggest, what then for the remainder? I ask because I have a similar problem (If it is a problem having money I don't know what to do with.) I am risk averse and don't have enough life expectancy for stocks and shares.

innovate

There are several other interest paying current accounts which accommodate some £29K - £44K cash. Even cash ISAs, generally considered poor value for money, pay you more than you are. Likely to get from Premium Bonds. So there's a place for another £15K a year.

eskbanker

Those looking to find a home for a monthly surplus could also consider regular savers: http://www.moneysavingexpert.com/savings/best-regular-savings-accounts

bryanb

innovate wrote: »

There are several other interest paying current accounts which accommodate some £29K - £44K cash. Even cash ISAs, generally considered poor value for money, pay you more than you are. Likely to get from Premium Bonds. So there's a place for another £15K a year.

My experience of some of the interest bearing CAs is that they require you to pay in wages/transfer direct debits etc. This limits the number of accounts I can hold without spending a lot of my spare time moving money around and changing dd and standing order instructions. Perhaps I'll just spend more.

Freecall

eskbanker wrote: »

It's a bit of sleight of hand - Halifax pays £5 reward per month regardless of how much money you leave in the account (it's not interest) and this is net, so grossed up is £6.25 per month, i.e. £75/year. Meanwhile TSB pays 5% gross interest, therefore £50/year, so by keeping the money in TSB for practically all of the time (other than briefly bouncing it into and then back out of Halifax), you get both the TSB interest and the Halifax reward from the same £1,000, therefore a gross £125 return on it.

.....and that is exactly what being MSE is all about.

:beer:

jimjames

bryanb wrote: »

Thanks for the clarification, but the OP is asking about £500 to £700 per month.


If you put £1000 to work as you suggest, what then for the remainder? I ask because I have a similar problem (If it is a problem having money I don't know what to do with.) I am risk averse and don't have enough life expectancy for stocks and shares.

What do you need? Maximum income or money to spend on something at a specific time?