New saver advice please.

Skint_Badger!

I've around £9500 to save and i think that this could be the best way to do it before it all slips through my fingers.

First off, an isa with BMW for the full £3000 at 6.7%.

Next up,£3000 into a savings account with icici at 6.3%.

That account will then drip feed £250 a month in to the Lloyds Regular saver account at 8% for a year.

Then £3000 into the BMW fixed bond at 6.7%.

The remaining £500 will go towards my 0% credit card balance.

Does this sound ok or have i missed somthing?

Your thoughts please.

Jonbvn

If you are a basic rate tax-payer, based on current RPI, index linked savings certificates are slightly better than the fixed bond, since they are tax-free, and the bond is not. If you are a 40% tax-payer, then the ILSC's are much better.

Skint_Badger!

Jonbvn wrote: »

If you are a basic rate tax-payer, based on current RPI, index linked savings certificates are slightly better than the fixed bond, since they are tax-free, and the bond is not. If you are a 40% tax-payer, then the ILSC's are much better.

Tax free ya say, i likes the sound of that.

So where do i start to look for these "index linked savings certificate"?

jem16

http://www.nsandi.com/products/ilsc/index.jsp

The_Fiddler_2

jem16 wrote: »

http://www.nsandi.com/products/ilsc/index.jsp

Can someone explain these products in idiot proof :rotfl: language for me. How much can I invest? How many times can I invest? What interest rate would I get?

Thanks:beer:

jem16

You can invest £15k into each issue - currently two (3y and 5yr). New issues come out fairly frequently and you can then invest in these.

Interest rate is 1.35% above rate of inflation. So 5.75% tax-free at the moment.

The_Fiddler_2

jem16 wrote: »

You can invest £15k into each issue - currently two (3y and 5yr). New issues come out fairly frequently and you can then invest in these.

Interest rate is 1.35% above rate of inflation. So 5.75% tax-free at the moment.

Is it tax free for everyone? Is that rate variable? Is that better than a high interest paying account such as Sainsbury's (for someone who pays basic tax)?

Jonbvn

The_Fiddler wrote: »

Is it tax free for everyone? Is that rate variable? Is that better than a high interest paying account such as Sainsbury's (for someone who pays basic tax)?

They are tax-free for everyone! The rate is variable, depending on RPI. The return is better than Sainsbury's, for a basic rate taxpayer AT THE MOMENT. If RPI drops, then the rate will drop. Please check the other T&C's on the NS&I website.