wanting to save £25,000

Darth_Calculus

Hi Moomi

The A&L Plus saver you have pays 6.0% (inc 0.75% bonus). However, there is also the A&L Direct Saver that pays 6.3%. There is a catch that if you withdraw anything in a calendar month, you wont get any interest that month (but from your post, it sounds as though you wont be drawing on it much), but other than that, it is a competitive rate.

Also, you wont have any days in limbo for transfering the money from your current account to a savings account from another provider.

So, I would pay money into an ISA first, and the remainder you could put into the direct saver.

moomi

Thank you both. i thought that you could only ever have 1 cash isa each, not one each in each tax year & can you tell me why i'd ber better opeing another in the next tax year instead of just putting my limit in the same one again (plus the previous years allowance & interest) wouldnt that work out better?

Darth C- i'll look into the direct saver and try & find out what the minimum is i can pay into the plussaver as i'm pretty sure i have to make some form of payment in each month.

save-a-lot

You are with the NS&I aren't you, so you are currently getting the best rate. Follow the best rates, even if money is spread thru different providers the gain is exactly the same. So 3K in one and 3K in another with at the same interest rate is exactly the same as having £6K with one provider.

Also, when you get into it more, you can even transfer previous years savings to other providers (but that has to be a transfer and not withdraw to pay into another) - so you can forever chase the best place for your money.

moomi

yes with ns& i. phoned yesterday & discovered i could be getting 6.30% instead of the 5.something% i'm on now too so have filled in the form for that & will post it off today. Please bear with me and forgive my ignorance but what i think you are saying is its fine to open another one each next tax year with a different provider IF they beat the ns&i, otherwise I can stick next years allowance in the ns&i on top of this years, yes? & if they do beat ns&i, I can transfer this years into the new one next year? but by the time i have interest on £3,000 for this year, what do i do with that as you can only put £3k in cant you? I know its going up to £3,600 though. What would be an approx amount of interest on £3,000 on the rate of 6.3% or does it not work like that either as I wont have had all the money in the direct isa for the whole year! dont I ask a lot!!!

save-a-lot

Hi Moomi

You can stick with NS&I if the rate remains good next year and just keep contributing into it. You can go with another provider if you find a better deal for next years allowance and just leave the NS&I account as it and stop contributing into it. Also, if you find that another provider offers 7% for example and they allow transfer ins you can transfer all the money you have residing in ISA's and ISA's of previous years into the new and better ISA with the high rate. Some providers allow transfer ins, other do not.

I hope that helps.

moomi

ahh, think I've got it now. i thought you wouldn't be able to transfer money over & above your yearly allowance but that seems not to be the case. this site is soo fab I have to say- so much help on here. I'm currently looking at how much I've paid into my isa since 1st April this year & how much I have left before I reach the max & am trying to arrange payments so the bulk of the money goes in here, thats before we even get this £25,000! So would you say that after Isa's each, just go for the highest rate account we can find for the rest of the money? I have seen some fixed rate bonds for 8% but dont know anything about them!

ManAtHome

Would be wary about the 8% fixed-rate bonds - quite a lot of these are 'trick' accounts where some of your cash is actually held as cash, and the rest goes into some stockmarket-linked investment.

Best one year fixed are slightly under 7% at the mo - good link here http://www.moneyfacts.co.uk/savings/bestbuys/fixed-rate-savings-accounts.aspx (is updated as new products come out)

moomi

so if i use up my isa allowance & husband uses his we will have approx £20000 to deposit somewhere- are lots of regular savings accounts with maximum amounts in better than one account with the lump sum in? cant seem to find much for depositing a lump sum.

Jonbvn

IMHO, if you can tie the cash up for 3-5 years then you should look at index linked savings certs (also from our friends at NS&I).

They are tax-free and if you can invest 15k each in each issue. They will always beat inflation (RPI) and are guaranteed by the gov't. If you pay tax, they are good. If you are a high rate tax-payer they are excellent!

HTH,

save-a-lot

Hi moomi

Did you explain to your OH and start the ball rolling????