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Best place to save £8k

garfy1
garfy1 Posts: 39 Forumite
in Budgeting & bank accounts
Ive currently got some savings sat in a 0% current account. This money is to overpay on my mortgage at the maximum of £500 pm. Obviously it would serve me better to be earning atleast a bit of interest. I will be maxing out my ISA this year anyway so this would rule out putting it into an ISA i guess? I also don't really want to have to change my current bill paying account as i share this with my OH. Whats my options?

Thanks in advance.
:beer:

Comments

  • YorkshireBoy
    YorkshireBoy Posts: 31,541 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Each of you opens two TSB Plus current accounts.


    Each of you sets up a pair of cross-funding monthly SOs for £500, ie from account 1 to account 2 and back again.


    5% AER on the entire £8K.


    But why are you thinking of funding cash ISAs, especially if you're BR tax payers(?), when you can make 3-5% AER in current accounts? For example, since there are two of you, you can get 5% AER on £19.5K (albeit only for 12 months on £7.5K of it). How much is the cash ISA paying?...I'll fill it up for you if it's more than 4% AER instant access (which is what you'd need to better 5% AER as BR tax payers). :D
  • wwfc_2
    wwfc_2 Posts: 51 Forumite
    Open 2 TSB accounts, you can put 2k in each at 5%, don't need Direct debits but each do need to be funded with £500 pm, you can transfer it from one to the other and then back to your current bank

    You could then get another 2 TSB joint accounts again as above
  • grumbler
    grumbler Posts: 58,629 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    garfy1 wrote: »
    Ive currently got some savings sat in a 0% current account. This money is to overpay on my mortgage at the maximum of £500 pm.
    To save £500 p.m. or overpay £500 p.m.? Does it have to be £8K lump sum?
    What is your mortgage rate and what income tax do you pay?
  • garfy1
    garfy1 Posts: 39 Forumite
    Thanks for those swift responses.

    I have just been blindly filling up my ISA without really taking the time to look at the best bank accounts to be using, more fool me. But thats why im here now!

    Does the TSB account 5% expire at any time or will it continue for the forseeable?
    :beer:
  • YorkshireBoy
    YorkshireBoy Posts: 31,541 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    garfy1 wrote: »
    Does the TSB account 5% expire at any time or will it continue for the forseeable?
    It's not an introductory rate.
  • grumbler
    grumbler Posts: 58,629 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    >> TSB Classic Plus
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