Where should I invest £4000?

mattbuk99

Hi all, I'm a total newb, so please excuse my blithe innocence in asking such a general question, but I'm really not sure where to start..!!
I'm studying at an art college and have sold some shares my parents bought for me for around £10,000 to cover my expenses.. After I pay my fees & food etc, I have around £4,000 left over, which I'd like to save with the best returns possible.. Any thoughts? I was looking at Martin's advice about putting it in a high-interest general savings account then transferring a little per month into a regular saver account with higher interest - is that a good idea? I think I should use an ISA as well, but would I do better to invest it all in something that will increase in value over inflation/interest etc?
thanks very much,
Matt

Liz_the_Whizz

hi mattbuk99

£4k - a nice cash cushion you've got there, especially as a student.

Easiest thing to do for starters is to put it on one of the high interest easy access internet accounts.

Martin lists ICICI @ 6.3% gross and Sainsbury's Bank @ 6.25%. I am with Icesave @ 6.2% - you have a choice and can see from other threads what people think of them all. If you're not a taxpayer, then you will get the gross amount of interest - which is nice:D

The other alternative is a cash ISA, as these are tax free savings so will be useful for you as a future taxpayer. National Savings & Investments pays the best rate @ 6.3%.

One idea would be to put £3k (the annual limit) into your ISA, then the rest into one of the easy access accounts as your float.

Good luck, and let us know what you decide.

isofa

Always use your ISA allowance first, so stuff 3K into the highest rate ISA you can find, the NS&I ones are good at the moment.

Then put the other 1K into a good high-rate instant access savings, plenty of options on these forums