Am I doing the most efficient saving??

masamoah

Right guys, I am now 27 and am desperate to get my first mortgage, ideally within the next 2 or 3 years. Here is my plan:
1. I am in the process of maxing out a Santander help to buy ISA. I can only put in £200 a month and have just put in the max £1200 on opening it. This pay 4%
2. I am maxing my HSB regular savings (£250 a month). This also pays 4%
3. I am creating a diverse portfolio with H & L which includes funds, bonds and shares. I invest about £300 a month in this. So I plan to buy shares in construction, banking, oil, as well as bonds to make this portfolio less risky.
I guess my question is, is there anything better that I could be doing to achieve my goal of getting £35k within next 5 years? Is there something I could be doing better? Please do let me know your thoughts. In an ideal world I would not want to touch my H & L portfolio, because my aim is to keep this for 20 years.

enjoyyourshoes

transfer to HSBC advantage account as RS = 6%

open current account earning interest? (TSB=5%(max £2K) & Lloyds 4%(max £5K) or Santander 3%(Max £20K)

The Lloyds then has a RS 4% I think £400pm

First direct has RS 6% (£300pm)

Fir savings get as many RS as you can as they tend to earn above 4% then recirculate this into a Santander as it maxes at £20K delivering 3%

Main site has a section on RS accounts

Gambling option= use £X per month from accrued interest and buy a Euro millions last Friday of the month as they have 5 guaranteed millionairs in a raffle. Slightly better odd winning big than the Premium Bonds.

nb0825

Something else that often gets forgotten is opening a halifax reward and halifax clairty credit card. Have 2 active DD's, pay-in £1000 each month and spend £300 on the clarity card per month and you'll receive £10 each month. Pay-in £1000 on the 1st and send a standing order to high-interest saving account on the 2nd to maximise interest.

Eco_Miser

nb0825 wrote: »

spend £300 on the clarity card per month and you'll receive £10 each month.

That's a cost of £290 a month. Which is fine if you would be spending them money anyway, but to me that seems more like a way of justifying spending, than an actual saving.

mvarrier

I would look at savingstream.co.uk for a portion of your money/saving. It is peer to business specialising in property bridging and development loans. The headline rate is 12% (1% per month). They have had no losses so far...

nb0825

Eco_Miser wrote: »

That's a cost of £290 a month. Which is fine if you would be spending them money anyway, but to me that seems more like a way of justifying spending, than an actual saving.

I'm not suggesting anyone spend £300 to get £10, but someone with a family or is regularly buying food, clothes, socialising etc. can easily spend £300 in any given month. Even if you didn't do it EVERY month, you would get the additional £5 in the month that you do. The £5 from the halifax reward account every month is guaranteed anyway, regardless of spending.

TomJ

enjoyyourshoes wrote: »

transfer to HSBC advantage account as RS = 6%

open current account earning interest? (TSB=5%(max £2K) & Lloyds 4%(max £5K) or Santander 3%(Max £20K)
.

Halifax Flexdirect also pays 5% on balances up to £33.5K, but only for a year.

The Lloyds then has a RS 4% I think £400pm

First direct has RS 6% (£300pm)

Fir savings get as many RS as you can as they tend to earn above 4% then recirculate this into a Santander as it maxes at £20K delivering 3%

3 banks offer 6% regular savers: HSBC, First Direct and M&S. All of them need current accounts with the bank. The relevant HSBC acct requires a £1750pm pay-in; M&S requires you to have switched an account to them and have 2 standing orders; FD's First Account has a £10 pm fee unless you pay in a grand a month, maintain an average balance of over a grand or have another product from the (eg a credit card or, as I have, a savings account with a pound in it). The downside of these accounts is you can't withdraw cash without closing the account and losing a lot of interest.

TSB, Nationwide and Santander all offer 5% regular savers, as long as you have a qualifying current account with them. The TSB and Nationwide qualifying accounts pay 5% as well, as discussed above, as long as you pay the relevant amount a month into them; Santander allows you to have the RS with their Everyday current account, no minimum pay-in required. They all allow withdrawal without interest penalty, though only the the Nationwide allows you to put the cash back in, and that has to be in the same month. Nationwide also allows the biggest monthly pay in, £500.

Lloyds does indeed have a 4% monthly saver, along the same lines as TSB's.

Eco_Miser

TomJ wrote: »

Halifax Flexdirect also pays 5% on balances up to £33.5K, but only for a year.

I've not heard of this account before - a market-equalling rate on a market-beating amount and an account name suspiciously like Nationwide's offering.

eskbanker

masamoah wrote: »

Right guys, I am now 27 and am desperate to get my first mortgage, ideally within the next 2 or 3 years. Here is my plan:
1. I am in the process of maxing out a Santander help to buy ISA. I can only put in £200 a month and have just put in the max £1200 on opening it. This pay 4%
2. I am maxing my HSB regular savings (£250 a month). This also pays 4%
3. I am creating a diverse portfolio with H & L which includes funds, bonds and shares. I invest about £300 a month in this. So I plan to buy shares in construction, banking, oil, as well as bonds to make this portfolio less risky.
I guess my question is, is there anything better that I could be doing to achieve my goal of getting £35k within next 5 years? Is there something I could be doing better? Please do let me know your thoughts. In an ideal world I would not want to touch my H & L portfolio, because my aim is to keep this for 20 years.

Your objectives and timescales may need more thought - do you want a mortgage in 2-3 years or £35K in 5 years? In three years you'll have paid 36 chunks of £450 into savings, plus £1K HTB ISA startup plus bonus plus some interest, so let's say that pot would be circa £20K. Is that enough for your mortgage or do you feel you need the £35K that you'd be approaching after the five years?

Ring-fencing long-term investment money is sensible only if it's consistent with your short to medium term goals, as if you found you needed it in 3-5 years it might not be worth what you'd be hoping at that time....

masamoah

Hi
I think I would need 5 years to get enough for a deposit really. House prices keep increasing, so I do not think £20k would be enough in 3 years’ time. So I need a mortgage in 5 years, by then I should have £35k. All I can hope is that in 3-5 years time, I would have enough money.

colsten

I would not put anything into an investment or P2P account if I need the money in the next 5 or so years. I'd keep it all in cash, so I am not exposed to any market crashes or to bad debt. Currently, it's easy to get 4%+ on £20-£30K across various current accounts and regular savers.