First paycheck advice

gabberz010

Hello,

I'm just looking for some wisdom and advice re: savings. I've read Martin's pages on h2b isa, current accounts and savings accounts but for whatever reason I'm still not too clear on what is best for me.

A bit of background. I've just started my graduate job with an annual take home salary of approx 24k. I have a 38k student loan but I'm out of the overdraft and I've just received my first months paycheck.
I'm very fortunate that I'm living in rent free and bill free accommodation for the next 12 months. I just have to pay for my car (fuel, MOT, insurance) food and my mobile phone.
First thing I've done is open a h2b isa with Virgin money and deposited a lump sum of 1.2k. But I don't know what to do next. I still have my Halifax student account but I'm confused as to which current account would be best for me currently and if I have enough to open a regular savers account alongside it. Currently have 1.5k in my halifax account...some of which will be for living costs this month...the rest I want to save.


Any advice would be gratefully received.

Thanks

themanfromamarillo

OK, first thing's first, you should try to get minimum 3 months, preferably 6 months of living costs saved as an emergency fund. High interest current accounts are a good place to put stuff but a) rates are in flux right now and b) you need to pass a credit check to get one.

The main thing here is the minimum monthly pay-in required. This ranges from £500 with TSB to £1500 with Lloyds. At the moment I would guess you are probationary so aren't paying pension contributions and you'll maybe get a month or two before you need to start paying tax. So you should probably work out how much you'll earn each month once those things kick in (along with student loan repayments) and how much you'll get in a paycheque and how much you'll have left over at the end of the month.

So for current accounts,

Use the amount you get in your paycheque and compare to the minimum payments for the different current accounts.

Are you paying direct debits? Some accounts require 2 direct debits to pay out of them to qualify for interest.

For regular savers,

If the amount you've got left every month is more than than the £200 you can put into a HtB ISA then you might want to look at a regular saver in addition to a current account. Another possibility (once you've got a bit saved) is more than one current account and just move money between those accounts for the minimum payment.

alanq

OP has since opened a duplicate thread which has had more responses than this one.

https://forums.moneysavingexpert.com/discussion/5518569