How To Maximise Interest, Unsure What To Do

bowlhead99

saintalan wrote: »

More like how come savings accounts pay 1% if you are lucky?

Economics.

guitarman001 wrote: »

Well it's happened...
I've got money spilling out of accounts earning NO INTEREST now. I've used up the major schemes and every month I've got > £2k adding to a pot earning nothing.
I put a little into P2P and I'm not willing to put any more into the stock market.
What do I do!?!

If you've used up all the high interest accounts (current accounts, regular savers etc), you are now down to 'only' using normal accounts from banks, building societies, credit unions, NS&I, which pay maybe 1-1.5% for short term access. NS&I is in the middle of that with 1.26% on monthly income bonds.

Presumably you don't actually need short term access if you have current accounts stuffed with cash coming out of your ears, so you could fix for longer and get a better rate.

If you don't want investment risk of any kind on this additional money, you just take the best rate you can find in the market for the hassle you're willing to go to, to set up and operate the account. This is exactly what people have done for years. That rate of 1-1.5% is broadly in line with inflation and 2-3x the bank base rate. The bank doesn't owe you a living so you shouldn't expect to get something inflation-beating or several times the base rate, with the capital fully insured and guaranteed.

If you do want investment risk there is p2p, investment funds etc but while these might be fine for the long term they are less suitable for the short term if you need the cash for spending or are deliberately holding it to take advantage of some sort of stock market correction you have forseen.