Savings Confusion!!!

rdixon555

Hi everyone,

I am after some advice. Currently I can save up to £900 per month and would like this to go towards a deposit for a house - however I am confused with all the options out there!

I have identified the following savings & ISA accounts (there may be others), and was hoping someone could advise on the best one to use and why. I currently have £15000 saved in a nationwide 1.6% instant access ISA (which was opened last tax year) and would like to have enough for a house deposit within 1-3 years.

- halifax 4% help to buy isa
- nationwide 2% help to buy split isa
- nationwide 5% savings account
- any other type of instant access ISA where a higher amount than £200 per month can be given

I dont mind splitting my money with different accounts.

Thanks in advance

Archi_Bald

Halifax HTB ISA and current/regular savings accounts [STRIKE]form[/STRIKE] from https://forums.moneysavingexpert.com/discussion/5374614

Forget normal cash ISAs altogether.

bobobski

What level of tax do you pay? If higher rate, I'd forget the Nationwide savings account beyond an emergency fund of a few thousand; it is beaten on paper by Halifax.

I'm starting to believe Archi - even though the H2B arguably won't "help" me, I'm still leaning towards it purely for the Halifax tax-free interest rate.

Otherwise, I'm in the same boat as you with less money and a longer realistic time frame. Good luck!

Vortigern

rdixon555 wrote: »

I currently have £15000 saved in a nationwide 1.6% instant access ISA (which was opened last tax year)

It doesn't matter when it was opened. What matters is when you last paid money in to this account.

If you've paid in to this ISA on or after 6th April 2015, you should open the HTB ISA with Nationwide (since they allow you to split your ISA money between their accounts)

If you haven't paid in to the Nationwide ISA on or after 6th April 2015 you should use the Halifax HTB (better interest)

For your spare £900/month use Regular Savers like Nationwide's at 5% or others @ 6%

Archi_Bald

bobobski wrote: »

What level of tax do you pay?

Unless you expect to earn more than £1,000/£500 (BR/HR) interest next year, tax doesn't even come into it from next April onwards.

Even if you did bust those personal interest allowance levels, and even as a higher rate tax payer, you would make more interest than in an ISA in many, many accounts.

The only exception is the [Halifax[ HTB ISA as it carries the prospect of a £3,000 bonus if you are eligible. As it takes only £200 a month, you still need another place for your remaining cash, and that other place shouldn't be a cash ISA for 99.99% of people.

Archi_Bald

Vortigern wrote: »

If you've paid in to this ISA on or after 6th April 2015, you should open the HTB ISA with Nationwide (since they allow you to split your ISA money between their accounts)

Financially better result would be to close the ISA, open the Halifax HTB ISA, and with the remaining money make hay in current accounts and regular savers.

rdixon555

Thanks all for the advice.

I think what i will do is something like this:
- £200 in the help to buy 4%
- £500 in the 5% current savings
- the rest in another current savings/isa

bobobski

You could also consider multiple regular savers. For example, my plan includes maxing out the TSB 5% current account and opening the linked 5% regular saver, while also maxing out my First Direct 6% regular saver.

Of course, one of the main limits is how much time you want to spend actively managing this. I have a friend who has a whole heap of money chucked into a 1%-ish ISA purely because he can't be bothered to do anything else. Makes me sad.