Bank account to hold equity from house sale?

Dawn248

I have just heard from my ex's solicitor telling me the consent order in our divorce has been agreed and my settlement of £200,000 can be transferred to me.
I'll be using the funds to buy a small flat outright.
I'd really appreciate some advice on where best to hold the funds. I don't want to put it in my current account so I'll set a new one up just for the purpose.
I don't think it will be in there very long, hopefully, but if I can get any interest on the money while it's being held that would be good.
I believe the Financial Savings Compensation Scheme covers temporarily large balances for up to 6 months so my money should be safe-BUT any up to date info or advice on this would be helpful. This is all the money I have from my divorce so I need to make sure it's safe.
Thanks for reading.

xylophone

You might as well put it in NS&I Income Bonds? You certainly won't make a fortune but it will be safe and accessible.

https://www.nsandi.com/income-bonds

System

Dawn248 wrote: »

I have just heard from my ex's solicitor telling me the consent order in our divorce has been agreed and my settlement of £200,000 can be transferred to me.
I'll be using the funds to buy a small flat outright.
I'd really appreciate some advice on where best to hold the funds. I don't want to put it in my current account so I'll set a new one up just for the purpose.
I don't think it will be in there very long, hopefully, but if I can get any interest on the money while it's being held that would be good.
I believe the Financial Savings Compensation Scheme covers temporarily large balances for up to 6 months so my money should be safe-BUT any up to date info or advice on this would be helpful. This is all the money I have from my divorce so I need to make sure it's safe.
Thanks for reading.

It depends how soon you wish to buy something. The FSCS scheme will cover the whole balance on a temporary basis (just keep proof such as the solicitors letters).

Who do you bank with?

B from Clydesdale/Yorkshire offer 0.75% on balances

jonesMUFCforever

I agree - you need it somewhere where you can access it quickly for the deposit and balance of the purchase price.
Your money will be protected as a special case under the FCA rules.

agrinnall

xylophone wrote: »

You might as well put it in NS&I Income Bonds? You certainly won't make a fortune but it will be safe and accessible.

https://www.nsandi.com/income-bonds

Interest rate is dropping from 1% to 0.75% from April (annoyingly announced just a few days after I'd opened my account) so there are other alternatives that at the moment will offer a little more interest.

Dawn248

Thanks for all your replies.


My current account is with Santander. I believe they are still covered by the FSCS rules despite being Spanish and the money will be safe for up to 6 months.
They have two instant access saver accounts;
Everyday Saver has an interest rate of 0.10% and the E-saver is 0.15%. So NS&I would be better even after it dips to 0.75% so maybe that's the way to go?

Dawn248

Just had a look and NS&I interest rate is 0.80 until 30th April and 0.70% from 1st May.


Any of you clever people have any idea how much I might make on £200,000 in three months??? Not very bright with maths!

bobobski

Dawn248 wrote: »

Just had a look and NS&I interest rate is 0.80 until 30th April and 0.70% from 1st May.


Any of you clever people have any idea how much I might make on £200,000 in three months??? Not very bright with maths!

About £400 I think, assuming it compounds.

EssexExile

About 400 quid!

Edit: beaten to it again, must type faster.

The last time I was in that situation about that amount stayed in the bank for 9 months & accrued a few thousand in interest. Ah, the good old days.

Dawn248

That's what I made it but thought I'd better check! Thanks


Been reading the NS&I blurb and apparently their Direct Saver account only pays interest annually, in April.
The Income Bonds pay monthly so perhaps this is best as I'll be using the money within a few months?Income Bond account requires £500 to open the account though so I'll have to hold the settlement in my current account and transfer it over once the account is open I suppose. (Don't have a spare £500 to use in the meantime).
Slightly scared of having £200,000 in my current account and then transferring it over..Am I being daft?

badger09

Dawn248 wrote: »

That's what I made it but thought I'd better check! Thanks


Been reading the NS&I blurb and apparently their Direct Saver account only pays interest annually, in April.
The Income Bonds pay monthly so perhaps this is best as I'll be using the money within a few months?Income Bond account requires £500 to open the account though so I'll have to hold the settlement in my current account and transfer it over once the account is open I suppose. (Don't have a spare £500 to use in the meantime).
Slightly scared of having £200,000 in my current account and then transferring it over..Am I being daft?

The Income Bonds would be better because they pay a higher interest rate.

The fact that the Direct Saver pays is irrelevant. Interest would be calculated each day on the amount in the account. If you closed the account, the interest due would be credited on the date of closure.

You won't be able to transfer £200k (or even £199500:p) in one go unless you're prepared to pay a fee. Check your account T&C for the daily or transaction limit.