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Best place for £30,000 savings??

I'm looking for opinions/advice on how to invest my savings short-term (1-2 years) for a decent return?

I am hoping to buy my first home in 1-2 years, as soon as my partner and I have a steadier income and before house prices rise too high. I'm aware there is a lot more I could be doing with my savings - I just don't know where to start?!

-£30,000 in a cash ISA at only 1.05% (down from 2.75% 2 years ago). -£360 in Premium Bonds.

-UK student loan from my undergrad degree of £6,300 (at 1.5% - MORE than I'm earning on them in the ISA but probably best to hold onto for mortgage?).

A little more about me: I'm 26, just graduated with a Master's - I worked for a few years and squirrelled away as much as I could before returning to university. I have started working a low-paid trainee graduate job so I can comfortably put aside around £400 per month but hope to land a higher-paying job soon so I can spend the next 1-2 years saving as much as possible.

Any advice would be much appreciated!


  • Herbalus
    Herbalus Forumite Posts: 2,634
    Tenth Anniversary 1,000 Posts Name Dropper
    Current accounts are the only place with decent interest rates. TSB Plus, Nationwide FlexDirect, Lloyds Club.

    Try searching the forum for these and you'll come up with the answers - people post similar questions a lot.
  • enthusiasticsaver
    enthusiasticsaver Forumite, Ambassador Posts: 14,703
    Tenth Anniversary 10,000 Posts Name Dropper I've been Money Tipped!
    If you need to keep the money readily accessible then look at some of the higher interest paying current accounts - You can invest up to £20k in a Santander 123 account to earn 3% gross. and if you have a partner you can have a joint and a sole one so would get 3% gross on up to £40k providing you can meet the criteria for both of them but there are ways of getting round that. There is a £2 monthly fee per account but if you have direct debits for utilities, council tax etc then the cashback should more than cover that.

    Most other investments paying more than 2% are fixed term which may not be ok for you. Check the best buys on this forum.

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  • colsten
    colsten Forumite Posts: 17,597
    10,000 Posts Seventh Anniversary Photogenic Name Dropper
    You can invest up to £20k in a Santander 123 account to earn 3% gross.
    I think we should stick with the distinction between investments and savings. £20K in an instant access account is saving. Investing would be something that involved buying equities and is generally for the 5+ year horizon.
    Most other investments paying more than 2% are fixed term which may not be ok for you. Check the best buys on this forum.
    Again, I think you are talking savings, not investing. There are several other current accounts that pay 3, 4 and 5% - taking at total of another £30.5K between them. By their very nature they are all instant access, and I would most certainly exploit the 4 and 5 % ones before I start with the 3% ones.

    OP, whilst I agree you should keep most of your cash in various current, and may be regular savings accounts, you should not discard starting to make pension contributions now alongside saving up for a deposit. Check what pension scheme your employer offers - it's free money for you.
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