40k for v. short time, where to put it?

Fay

We have just sold our house-complete next friday, and we will be left with nearly 40k. The house we want isn't ready yet, and the solicitor said that we need to have the money back they don't hold it. So what should we do with it?

we have no idea how long we will have it for...1 month minumum, forerver maximum! We already have an instant access savings account with HSBC, but I'm guessing this might not be the best place to put that much money?

any advice would be very gratefully received

grumbler

£25K A&L online saver 5.35%
£15K Bradford & Bingley eSavings account 5.25%

ManAtHome

Yes, only real advantage in using HSBC savings is that you can move between accounts 'instantly' if you have on-line banking. Only half-decent interest rate is the online saver which is 4.70% but there is a catch - you don't get any interest for an entire month if you draw out any cash (so ok if you'll definitely need it on the 1st of whatever month..).

Have a look here http://www.moneyfacts.co.uk/menus/main/selections_savings.htm and check out 'no notice' and internet accounts. May be best to go for an account with a bonus for a few months - these are usually the highest rates and you can always move it on if it's a long wait for the house (hope not!)

Alternatively, if you have handy Building Society branches start here http://www.building-societies-uk.co.uk/ to see if they have a web site for checking branch/passbook interest rates.

Only other thing worth mentioning is that you can only move up to £10k per day from a HSBC current account via online banking (although there can be ways round this, depends on the target account), so think about where you want to pay the cheque in.

Cagey

Grumbler, is £25k the maximum you can hold in A&L online account. I thought it was the max you could transfer in a transaction.

Kazza242

Cagey wrote:

Grumbler, is £25k the maximum you can hold in A&L online account. I thought it was the max you could transfer in a transaction.

It's the maximum balance you are allowed to hold in the A&L Online Saver.

grumbler

Cagey wrote:

Grumbler, is £25k the maximum you can hold in A&L online account. I thought it was the max you could transfer in a transaction.

Online Saver :

'Maximum balance: £25,000 per account'

Fay

Thanks for the info guys. But if I put the money into 2 accounts it would mean that I would need to pay 2 lots of transfer when I have to send it back to the solicitor wouldn't it!

I'll have a look into the A&L one though

Edit: how much interest could I expect to earn if the money were only in the account for say a month? Would it be worth me setting an account up for that period?

BigDunc

£40,000 * 5.35% is £2,140 per annum before tax so one month should be one twelfth of that - approx £178.

cheerfulcat

Hi, Fay,

It could be worth asking your bank/building society whether they offer a money market account. This is a fixed term, fixed rate account but the term can be as short as seven days, and it can be rolled over automatically ( and for anyone with more than £50000 to invest the interest is paid/rolled over gross...). The rates I have been offered in the past have been competetive, rather than outstanding, but given that your first priority is ease of access, this might be worth considering.

HTH

Cheerfulcat

grumbler

Fay wrote:

... if I put the money into 2 accounts it would mean that I would need to pay 2 lots of transfer when I have to send it back to the solicitor wouldn't it!

If you know the deadline well in advance you can spread transfers overe a few days and pay nothing.

You can also consider something new: ICICI Bank HiSAVE 5.40% AER

Fay

Thanks guys, lots to think about.

We have now put an offer in on a different property which has been accepted, so fingers crossed if everything goes ok our solicitor said we could be looking at as little as 3 weeks