This Savings Lark

JB9302

For the 1st time in our marriage (36yrs) we have been able to save some money , mainly due to running one car instead of 2/cancelling Sky/not renewing 1 mobile contract and as my wife has kept working we have been able to put away her state pension.
Saved last years Cash Isa allowance which pays 2.25% maturing in Sept , started this yrs saving £900 pm paying 2.59% till next March (£2140 in at moment) .

Saving £200 pm in a N/wide regular savings account for emergencies , £100 pm to premium bonds ( yes I know the odds ) .
When she retires in Nov 16 we will have approx £46000 in savings behind us spread over cash isa/premium bonds/current & regular savings accounts .
I am a member of a Credit Union saving £75pm , it generally pays 2.5% but I can put max £500 per month into a 90 day notice account and receive 1% extra after yearly dividend (2.5% present).

Would £500 of the £900 I am saving in this yrs Isa be a better option going into the Credit Union saver at hopefully 3.5% gross next yr ?
Any suggestions for the cash Isa maturing in Sept ?
No mortgage

Thanks

jimjames

Are you already using the best interest paying current accounts? If not it's worth using them too, potentially in preference to ISAs.

JB9302

Just upgraded to Flexdirect for the current account .

Eco_Miser

That's good, but you're not limited to one current account. You can also have 2 TSB Plus (5%), a Club Lloyds (4%) and a Santander 123 (3%) EACH, and again jointly.

atush

I have 2 points to make about your savings.

Saving in cash when you had none was a great idea. but saving Only in cash once you have a decent emergency pot is not always the best. I would consider saving some going forwards into equities. And as you are still working, into a personal pension where each 80 invested becomes 100. Over periods of ten years and more these will beat cash savings and keep you ahead of inflation. Mind I am not saying to Not save into cash at all going forwards, just think about saving some as equities. Esp money that will be used later in retirement.

Second, saving your OH's SP. You would have been better off (or still can be) by deferring the SP as it get s a 10.4% boost for each year you don't take it, incremented monthly. This money is guaranteed and indexe for life. Far better than a savings acct, and you can defer once even after taking the SP.

bowlhead99

atush wrote: »

Second, saving your OH's SP. You would have been better off (or still can be) by deferring the SP as it get s a 10.4% boost for each year you don't take it, incremented monthly. This money is guaranteed and indexe for life. Far better than a savings acct, and you can defer once even after taking the SP.

I would agree, if you do not need the weekly cashflow coming in from your OH's pension, you should definitely arrange to have it deferred and then just build up a lump sum or future income. The government are so keen for you to do this that they will pay you a great return.

https://www.gov.uk/deferring-state-pension

Doesn't do you much good if you die in a couple of years without ever getting round to taking the pension, but then neither does stashing it in an ISA or savings account (or high interest current account) at a much lower return.

JB9302

Appreciate all the suggestions , tried to get the OH to defer her pension last year when it started but she is stubborn and would not , going to try again as we are just saving it each month in the ISA .
I am retired and OH working to retirement in Nov 16 .
Looking to open 2 TSB current accounts and wonder whether I should do that now by withdrawing last yrs ISA money ( interest not due till Sept 14 ) or wait till then and withdraw after interest ?

Eco_Miser

If the ISA is for a fixed term with a penalty for early withdrawal, leave it. If it's easy access, you can close it now, and get paid interest up to closing.

Check the Terms & Conditions to be certain of any penalties.

JB9302

Eco_Miser wrote: »

If the ISA is for a fixed term with a penalty for early withdrawal, leave it. If it's easy access, you can close it now, and get paid interest up to closing.

Check the Terms & Conditions to be certain of any penalties.

Yes it was an easy access ISA .

atush

If she wont defer and she is still working, save her SP into a personal pension plus any extra you can afford.

You could have one too as a non working person, but can only save 2880 (which becomes 3600 after the tax relief)

innovate

360 = 3600