Savings and Investment advice needed please

MundoMar

Hi all,

We are a couple both aged 48 with two young children. My husband works full time and I work part time.

We are currently saving to buy a house, which we want to do in 3 years' time. We have around £35K in a Life Strategy 60 S&S Isa.

We also have £12K savings in a Santander 123 account.

We are able to save £3,000 a month, and have no debt. We do not currently own any properties, but have in the past. We are renting at the moment.

Where would be the best place for us to invest/save? As we will need the money within a short time frame we are not sure the S&S Isa is the best place? Any advice would be appreciated.

stoozie1

3 x Nationwide Flexdirect, (1 each and 1 joint) earning 5% in year 1. (remember to recommend OH for both of you to get £100)
2 x Nationwide flexclusive regular savers funded with £500 monthly
2 x Santander regular savers putting away £400/pcm

Then look to open up other current accounts offering 5% regular savers and 3% in-credit interest.

teddysmum

stoozie1 wrote: »

3 x Nationwide Flexdirect, (1 each and 1 joint) earning 5% in year 1. (remember to recommend OH for both of you to get £100)
2 x Nationwide flexclusive regular savers funded with £500 monthly
2 x Santander regular savers putting away £400/pcm

Then look to open up other current accounts offering 5% regular savers and 3% in-credit interest.

The person recommended to Nationwide has to do a switch and bring two direct debits to the new account.

MundoMar

Thanks for your replies, I already have a Nationwide current account and saver, but DH could look into getting one. We already have the Santander 123 and recently started the saver.

Any further suggestions anyone?

JustinP

Since inflation erodes the value of money over time, it usually saves some kind of investment. This is typically a balance between risk and profitability. Low-risk investments (such as cash savings) keep money relatively secure, but offer low growth rates, while others offer potentially better growth, but also risk losing more money. The best savings strategy for you depends on your personal circumstances

YorkshireBoy

stoozie1 wrote: »

3 x Nationwide Flexdirect, (1 each and 1 joint) earning 5% in year 1. (remember to recommend OH for both of you to get £100)

£400 is possible, if they play their cards right.

YorkshireBoy

MundoMar wrote: »

We already have the Santander 123 and recently started the saver.

If you cover the fees with cashback consider downgrading to 'Lite' and shift the £12K elsewhere. At least 3% (soon to be 2%) is available at BoS.

If you don't cover the fees...well, why is the money there in the first place!? Being as it's making less than 1.5% AER!...and that's very poor when there are much better options available.

You should be making 5% AER on the entire £3K per month savings. That's your target.

redpete

JustinP wrote: »

Since inflation erodes the value of money over time, it usually saves some kind of investment. This is typically a balance between risk and profitability. Low-risk investments (such as cash savings) keep money relatively secure, but offer low growth rates, while others offer potentially better growth, but also risk losing more money. The best savings strategy for you depends on your personal circumstances

The OP has described some of their personal circumstances. They are saving for a house deposit to use in about 3 years. This means there is not enough time for rises and falls in the equity market to cancel out, they will not be able to wait longer if the value has dropped when they decide to buy a house and therefore they want low risk of the value of their pot dropping.

An investment based on the equity market (like Vanguard LS) is therefore not suitable, indeed they should be saving rather than investing.

It might be that they are open to some risk, maybe they need to guarantee that they will have £x available in 3 years but can take a risk on the rest. In this case some into equities might be fine.

xylophone

I already have a Nationwide current account and saver

It is possible for each of you to have a Flexdirect and you can have a joint Flexdirect as well.

Tesco has reopened its current account to new applicants- there is now the DD requirement but you may be able to meet this.

enthusiasticsaver

You need to look at saving rather than investing if your timescale is 3 years unless you can do without the s and s isa should the market be low when you come to buy your property. It may well be that the market is high in which case you can withdraw the s and s isa but as you know there are no guarantees with investments and the worst thing you can do is sell when the market is in a dip.

Sheltering £36k per year though wont be easy with interest rates so low but check out regular savers. Santander, Lloyds Club, Nationwide, TSB, First Direct and Marks and Spencer all do good ones.

Tesco, Bank of Scotland current accounts and max the Santander up to £20k with all your household bills going through that to offset the fee with cashback.

MundoMar

Thanks for your advice everyone, it's hard to keep a certain amount in cash and still try to make something on it, we will be able to keep the S&S going separately (as we started it for retirement income) from the house money I think.

Will look at regular savers as advised, and check the cash back on the Santander is covering the fee. Not sure about all the bank accounts, but will look into them too.