Where to put 50k for 6-12 months?

Pincher

Chrissywissy100 wrote: »

We are both higher rate tax earnings. I'm not sure I understand what this changes? Is it the tax on the interest you are thinking of?

Premium Bond pay outs are "prizes", and TAX FREE.

NS&I Income Bond monthly pay out are interest, so I have to pay 20% tax. :mad: .

Why? :wall:

Technosaurus

Great to see so many people endorsing Premium Bonds. Savings rates at the minute are a joke and fretting over 0.9 - 1.5% on an amount for only a few months is almost more hassle than its worth if you need easy access (I know that's not technically very MSE but I found myself doing all sorts of rigmarole in similar circumstances last year and the returns weren't worth the time spent researching IMO!).

If your time period was longer than 6-12 months then there are better options but considering you have maxed your ISA's already, for relatively short term and relatively easy penalty-free access, Premium Bonds are the easy winner.

Odds are 30,000-1 for £25 so in 6 months with average luck you'd make a bit of a return PLUS you might win bigger...

ColdIron

If the timescales are closer to 6 months than a year bear in mind that you are not entered for the draw until after a full calendar month after you buy them

So If you buy them in November they are not entered into the draw until January

If you withdraw them in 6 months time (April) you will have only been in the draw for 4 months and this will reduce the notional 'interest' you might receive

bigfreddiel

Pincher wrote: »

Premium Bond pay outs are "prizes", and TAX FREE.

NS&I Income Bond monthly pay out are interest, so I have to pay 20% tax. :mad: .

Why? :wall:

Only pay 20% on interest above £1,000!

So £50k at 1% will pay £500 in one year, so tax free!

Fj

Pincher

bigfreddiel wrote: »

Only pay 20% on interest above £1,000!

So £50k at 1% will pay £500 in one year, so tax free!

Fj

Oh please, as if we haven't all used up the £1,000 allowance on 5% Regular Savers etc. already.

Getting only 1% AND pay 20% tax, that is really taking the biscuit. :mad:

bigadaj

Pincher wrote: »

Oh please, as if we haven't all used up the £1,000 allowance on 5% Regular Savers etc. already.

Getting only 1% AND pay 20% tax, that is really taking the biscuit. :mad:

There could be more biscuit to take.

When you get charged negative interest rate on your savings for example, maybe you'll then get tax relief like the old morals scheme though.

Pincher

Paying higher rate tax on 1% interest is also more biscuit.