Best place to stick £35k?

rathernot

As subject really.

I have £35k that I would like a decent return on whilst being able to get near-instant access to it should I need it (I don't envisage this happening but would sooner the option be there).

I already have the maximum available to me in a cash ISA.

I'm assuming it comes down to choosing the best Savings Account, which for that amount would seem to be either Alliance and Leicester or Sainsburys?

Am I missing any obvious options?

There's no mortgage/existing debt to pay off first.

Thanks in advance.

Jonbvn

Have you considered index linked saving certificates, which are tax-free? Maximum 15k per issue. Minimum 1 year to get any return.

rathernot

Have to admit I hadn't looked at them, though the NS&I website says minimum term is 3 years?

Part of me is interested in what I could do if I wanted to use a couple of grand and have a dabble with stocks/shares/investments etc. (more out of curiosity/interest than the expectation of a fast buck) but I don't know where to even start with that one - any pointers appreciated whilst I dig around.

jinkssick

if its not needed the gains are quite substantial. its at 5.65%.

Jonbvn

rathernot wrote: »

Have to admit I hadn't looked at them, though the NS&I website says minimum term is 3 years?

Part of me is interested in what I could do if I wanted to use a couple of grand and have a dabble with stocks/shares/investments etc. (more out of curiosity/interest than the expectation of a fast buck) but I don't know where to even start with that one - any pointers appreciated whilst I dig around.

How about you put 4k into an S&S mini ISA now, and the rest into saving certs? With the savings certs, you must keep them for a minimum of a year to get any interest. At the end of the 1st year you can take some money out of the certs and put into the S&S ISA.

HTH.

rathernot

Any more thoughts on this please?

It still seems, unless I'm missing something, that with any sort of bond/certificate the returns are a tenth of a percent or so higher than on a high interest savings account, which doesn't seem a price worth paying for having no access to my money should I need it?

jem16

The NS&I certificates are 5.65% tax-free. The highest instant acess savings account is 6.3%. With 20% tax deducted this equates to 5.04%.

So there is a difference of 0.61%. On £15k that's £91.50 pa. On £30k that's £183 pa.

That's a fair difference.

rathernot

But if I read the NS&I site correctly I can't touch it. At all. For 3 years?

jem16

No that's not correct.

If you take it our before a year you lose out a bit but not after that.

Access
If you need to take money out before the end of the term, you can cash in your Savings Certificates whenever you like. Any returns you earn are still tax-free. Savings Certificates cashed in within the first year of investing don’t earn any index-linking or extra interest, so it’s best to keep them for at least a year. If you cash in Certificates any time after the first year, you will earn index-linking and extra interest for each complete month you’ve held them.

Jake'sGran

rathernot wrote: »

But if I read the NS&I site correctly I can't touch it. At all. For 3 years?

I am using Sainsbury's at the moment because, like you, I like to have access. Northern Rock are paying the same rate with instant access. The stock market is very jittery right now but some pundits are saying 'no cause for alarm' and that there will not be a crash. If you fancy a flutter you could put the £2000 you mentioned into one of the highly rated trusts. People always talk about finding the best managers these days and Neil Woodford of Invesco Perpetual is highly regarded. I have invested my S&S ISA (up to £4000) for the past few years in his Income and High Income funds. I'm not mad about M&G but last year I changed an old PEP I had with them to their Global Basics fund and it put on another £2000 in about seven months (On £12K). I have done the cash ISA with Kent Reliance, soon paying 6.21.No one should give financial advice on this forum but if you read the better sites giving performance tables it should help, e.g. iii, digital look, trustnet, bestinvest and so on. To get a discount on the initial charge if you do buy an investment most people use Hargreaves Lansdown - often the discount is the full initial charge.

rathernot

Thanks for that, the Northern Rock account is only for over 50's though.

Sainsbury's looks good except for annual interest. At the moment unless something better is on the Horizon it looks like Alliance and Leicester or maybe Icesave (the latter appear to pay interest monthly with no penalty for withdrawals).

So far as the "flutter" I'm also trying to get my head around the options. Seems I could do the trust/fund in a Maxi ISA thing or just use a "Pay as you trade" account and try my hand at shares.