What to do with £2000

Boudica

Hi

I'm after some advice. I've recently got an unexpected £2000 which I would like to invest. I would like instant access to the cash but a good interest rate.

I've never had money to invest before so really have no idea what to do.

Any ideas/advice very welcome.

Thanks

Aegis

Can you pay off any of your loans early without hefty fees? Generally speaking you'll probably get a better rate of "return" by paying off debts (other than mortgages in some situations) than you will by saving. You might be able to make more money on the stockmarket, but it's pretty risky.

However, if you really want to save even after all this, then there are plenty of options out there. Top level instant access savings at the moment are 6.41% with ICICI's HiSave account.

Boudica

Thanks for your reply.

The money is really my daughters as a policy matured on her 18th birthday. She doesn't know she has the money and it's going to be used to help for university etc. I wanted it to be a little nest egg for her.

I was thinking of maybe splitting the cash, half in a cash isa and half into shares but I really don't know enough to go ahead.

I'll look at you suggestion definitely....

thanks for the advice

basil92

You would be best investing in an instant access ISA if you are investing in your name, as it is tax-free. However as she is still a child you could invest in a childs account with a high interest account, which will be tax free, but would require your signature to access the money. I'm not sure shares are a good idea because you can never guarentee a good return. Hope this helps

Boudica

Thanks Basil........

i keep going back to the isa option because it is probably the safest one for her.

thanks for replying....

Aegis

ISAs and saving accounts are definitely the safest options for £2000, especially considering the somewhat turbulent market performance recently!

If you decide to dip your toe into the stockmarket before too long, be aware that the value of any investment right now is likely to be all over the place. As such, if you have any nerves about dropping values, then I would certainly suggest that you think twice about jumping in just now...

looby-loo_2

My daughter inherited £3000 at 18, just a year before going to uni. We put it in an ISA in her name. She worked out she would get about £150 interest which would be £50 a term or £5 a week at uni. She says she uses this [STRIKE]for[/STRIKE] (towards??)her Friday night out - she's a very MSE girl!

Then, as she's aiming high,:rolleyes: she worked out it was better in an ISA than high interest building society because WHEN she is a high rate tax payer that money will always be tax free. :T