Where to save when mortgage is paid off?

veryintrigued

YorkshireBoy wrote: »

It was correct for the point they were trying to make. The same point you are making...just in a different way.Always dangerous (and why I try to remember to add the letters when quoting an interest rate to avoid any confusion).

I cant think of any time I've ever considered non deposited money in a regular saver to assume it'll accrue interest or have ever compared regular savers on anything other than an annual interest basis so AER is just a given to me.

Hence the 2.5% is just nonsense (to me at least).

Onwards....and back to the O.P.

Dan83

there are loads of banks you could open to maximise your interest, it would involve opening 1 or 2 bank accounts a month at 1st, but you could also bag loads of switch bonus.

1st I'd open a nationwide account, put £2500 in and recommend your partner, your partner then switches and you get another £100 each. Put £500 in your partners account.

Then the month after put £2000 in your partners account and your partner recommends you as joint account, anothe £100 each. Put the extra £1000 in the joint account.

I'm sure you can see where I'm going with this.

Eco_Miser

veryintrigued wrote: »

I cant think of any time I've ever considered non deposited money in a regular saver to assume it'll accrue interest or have ever compared regular savers on anything other than an annual interest basis so AER is just a given to me.

Hence the 2.5% is just nonsense (to me at least).

Onwards....and back to the O.P.

You are confusing an amount with a rate.
2.5% of the final balance is (approximately) what the amount of interest received will be. Since most of this has been in the account for well under a year, this equates to an annual interest rate of 5%.

jimjames

Duckyduck wrote: »

Or alternatively carries the opportunity and possibility of a better return...the OP owns a house outright, has 3k a month available and has said they're not averse to all risk. They can afford to accept risk if they wish.

I agree. So far the replies have all focused on putting the money all in the same place ie cash savings. There is no reason why a part of it couldn't be invested in a S&S ISA in a suitable fund or funds so the OP has spread some of that risk.

veryintrigued

Eco_Miser wrote: »

You are confusing an amount with a rate.
2.5% of the final balance is (approximately) what the amount of interest received will be. Since most of this has been in the account for well under a year, this equates to an annual interest rate of 5%.

I refer you to my post you replied to.

And also paste the original post that I took umbrage below from Chesky.

You do realise that you don't actually receive 5% on the whole amount you save, don't you? It works out at around 2.5% in the end.

Having already been advised by YB that there is nothing incorrect with the above passage I really will leave this thread well alone.