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Offset or savings?
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emmonk
Posts: 24 Forumite
We have a flexible mortgage with Abbey with an interest rate of 6.24%. It has an offsetting ability, by allowing us to overpay into a linked savings account.
We currently have £20K that we will be using in the next 6 months or so to rennovate our house.
I have an ICICI savings account at 6.3% and I don't pay tax.
Would we be better off keeping the money in the ICICI account or putting it in the Abbey linked savings account? The ICICI has better interest but I don't know if the long term savings by offsetting make it better to do that?
Hope someone can help!
Emma
We currently have £20K that we will be using in the next 6 months or so to rennovate our house.
I have an ICICI savings account at 6.3% and I don't pay tax.
Would we be better off keeping the money in the ICICI account or putting it in the Abbey linked savings account? The ICICI has better interest but I don't know if the long term savings by offsetting make it better to do that?
Hope someone can help!
Emma
0
Comments
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interest rate wise not much in it, you will earn about an extra £1 per month, are you close to becoming a tax payer ? if so Abbey would be better.
Other things to consider are the time taken transfering to icici if it takes an extra day or do that will wipe out any saving, also abbey is presumably more convenient to pay in/take out.I am a Mortgage Adviser
You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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