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wanting to save £25,000

edited 30 November -1 at 1:00AM in Savings & Investments
23 replies 1.8K views
moomimoomi Forumite
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edited 30 November -1 at 1:00AM in Savings & Investments
Dunno where to start! I have an Isa which I only pay £15 a month in at the moment but after maternity leave finishes will be back up to £50 per month. No debt other than mortgage- any suggestions where to start please? I am married and husband has no Isa so maybe start there?:confused:
Mortgage Balance June 20 - £49,294.83 due to overpayments, getting there!
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  • save-a-lotsave-a-lot Forumite
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    The title of the thread suggests you want to save £25K, so if you are saving a small amount monthly how will you achieve the £25K target?

    Best bet is to start your hubby off with an ISA, I can suggest the NS&I Direct ISA as I think it still tops the best buy ISA lists. Have a good look around this part of the forum too to get inspiration.
  • McSaverMcSaver Forumite
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    If you pay into an ISA that is 6% on £50 a month it would take you nearly 21 years until you reach £25,000 if you have nothing to start with.
    Had £80,000 in Savings - All GONE!!! BYE BYE
    :A Single, 27, Aspie, Gooner :A
  • moomimoomi Forumite
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    Sorry- what I meant is we will have £25,000 to save,by save I mean save in an account with preferably the best rates as opposed to investing it in stocks, shares etc. To us its an awful lot of money & want to make as much from it as possible! As I said I have an Isa (few yrs old with the NS&I) & will be putting £50 a month in from January- I also have a linked savings account to my current account with A & L & will be putting in around £150-£200 a month (again from January) but have no idea of the rate I'm on for this & whether its best to move this money?
    Mortgage Balance June 20 - £49,294.83 due to overpayments, getting there!
  • moomimoomi Forumite
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    actually the A & L account is a Premier current account with a linked Plussaver
    Mortgage Balance June 20 - £49,294.83 due to overpayments, getting there!
  • save-a-lotsave-a-lot Forumite
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    moomi wrote: »
    Sorry- what I meant is we will have £25,000 to save,by save I mean save in an account with preferably the best rates as opposed to investing it in stocks, shares etc. To us its an awful lot of money & want to make as much from it as possible! As I said I have an Isa (few yrs old with the NS&I) & will be putting £50 a month in from January- I also have a linked savings account to my current account with A & L & will be putting in around £150-£200 a month (again from January) but have no idea of the rate I'm on for this & whether its best to move this money?

    £250 a month into the ISA would be a better idea as the interest is tax free and will be for as long as the money remains in an ISA. You are best using up your tax free allowance every year before saving anywhere else.
  • save-a-lotsave-a-lot Forumite
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    Hi

    Use this thread to check what is the current best ISA...

    Mini Cash ISAs: The Best ISAs currently available List

    and this thread for inspiration...

    How much can you save?
  • moomimoomi Forumite
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    thank you.

    whats the best way of getting the most interest? is it not better to put the lump sum of £25,000 into a decent rate savings account as opposed to mini cash isa & then the rest in a decent rate savings account? Which would get me more interest? To my mind I'd have thought that the larger sum would accrue the bigger interest?
    Mortgage Balance June 20 - £49,294.83 due to overpayments, getting there!
  • save-a-lotsave-a-lot Forumite
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    Hi

    Feed your ISA every year, and use the tax free allowance for you and your spouse, so in this tax year that is £6000, next year the allowance on a cash mini ISA will be £3600 each, so tuck away £7200 in 08/09. So in 4 years if you max out your ISA's you would have £6K + £7.2+ £7.2K + £7.2K= £27.6K in 4 years (that assumes that the allowance remains at £3600/individual/tax year) all earning tax free interest, probably at over 6%.

    In a high interest savings account with a rate of 6% this would in fact be 6% - 20% tax and that equates to 4.8% interest after tax is deducted. So use up the tax free allowance every year in the ISA.
  • moomimoomi Forumite
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    understood- many thanks for that- will explain it to husband now.
    Mortgage Balance June 20 - £49,294.83 due to overpayments, getting there!
  • PrimrosePrimrose Forumite
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    You can both use your £3000 Cash ISA allowance each tax year, so before April 2008 it would be sensible for you both to deposit this amount each in a Cash ISA, leaving the remainder in the highest rate savings account you can find. Then after April 5th next year, you both open another £3000 Cash ISA each. Although the high rate (non Cash ISA) account may offer a higher rate of interest I assume you will both have to pay basic rate tax on any interest. Also, if you don't use your ISA allowance every tax year you lose it as you can't backdate it, so the sooner you tax-protect as much of your savings as possible, the better.
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