Very short term money- where to invest £100k

Anna15

Hi,
I was wondering if anyone has any advice on what to do with money I get from sale of my property while I'm looking for a new place to buy? I will have around £100k coming in from sale but am expecting to buy a new place in about 3-6 months time so I was wondering if there are any saving accounts or other tools that I could put my money in for 3-6 months to get at least a little bit of interest? Thanks in advance.

wjr4

NS&I income bond

Terry_Towelling

You could do a lot worse than a Paragon 120-day notice account. Max deposit is £100K, interest rate is currently 1.66% and the notice period fits in reasonably well with your plans. Deposit the cash and serve notice to withdraw it all as soon as it has cleared.

If interest is credited to the account, you won't know exactly what amount to quote on your withdrawal request but there are two ways around this. Either have interest paid to your nominated current account (but you will lose the compounding effect of interest on interest) or just select a withdrawal amount that will leave a balance of less than £500 (doing so will lead to closure of your account - bingo!).

In your case only the former method will allow you to clear out the account in one go because the interest accruing (if paid into the account) will probably be a little over £500 in 120 days time and you can't serve notice to withdraw more than the cleared balance at the time you serve that notice.

Also don't worry about the £85K FSCS protection limit because this doesn't apply to 'life-event' sums of money such as a house sale.

Anna15

Thanks so much for your advice, I haven't even considered notice accounts before. I have now found one with even better rate- 1.73% with Secure Trust Bank so might get this one. Thanks again!

george4064

Anna15 wrote: »

Thanks so much for your advice, I haven't even considered notice accounts before. I have now found one with even better rate- 1.73% with Secure Trust Bank so might get this one. Thanks again!

Just as long as you understand the notice period and other restrictions, go for it.