Some ideas on where to save or invest 20k for 1 year

bigstevex

As the title says really, we have 20K we'll need back in ~12-18 months for an extension so we want to put it somewhere useful for this time.


Happy with Medium risk/unprotected capital suggestions. Higher rate taxpayer and currently don't have any form of ISA. Can spread the money across myself and wife too if it's more beneficial to use an ISA in some way?

xylophone

If you need the cash in so short a period then investing ( along term game), does not seem a good idea.

https://www.thisismoney.co.uk/money/article-1583859/Best-savings-rates-General-savings-Internet-branch.html

MarkBargain

Your ISA allowance is £20k each a year. What about a Yorkshire Building Society Limited Access Saver ISA which pays 1.35%?



https://www.moneysavingexpert.com/savings/best-cash-isa/#fixed

eskbanker

MarkBargain wrote: »

Your ISA allowance is £20k each a year. What about a Yorkshire Building Society Limited Access Saver ISA which pays 1.35%?



https://www.moneysavingexpert.com/savings/best-cash-isa/#fixed

Unconvinced that there's any merit in using ISAs unless OP also has substantial other cash reserves that would cause interest earned to exceed the personal savings allowance, so would have thought a better bet would be BLME's one-year fixed-term 1.8% account....

Albermarle

we'll need back in ~12-18 months

Happy with Medium risk/unprotected capital suggestions

These two comments are not compatible .
Even in a medium risk fund a drop of 25% in 18 months would not be unremarkable .

colsten

If you are prepared to put a bit of work in, and if you haven't already got the accounts mentioned, you could do a lot better than having the lot in the best 1-year fixed bond (the 1.8% at BLME).

If you keep it all in one place, max you could hope to get is £360. If you put some effort into splitting it, you could get upwards of £600

£7.5K into Nationwide FlexDirect accounts , 5% AER for 1 year, on max £2,500 per account = £7,500

• 1 x FlexDirect in your name
• 1 x FlexDirect in your wife's name
• 1 x joint FlexDirect
• cycle £1k between your current account and each of the FlexDirects

Keep the remaining £12,500 in an interest paying account, e.g. a Marcus at 1.35% AER. Dripfeed most of it it into Regular Savings accounts. An easy one to open is the Coventry Regular Saver, 2.5% AER, max £500/mth. You'd need one each for yourself and one for your wife as the max you can get into each account is £6,000.


You could also consider TSB Plus, as you can presently get £50 via Quidco for opening a TSB account - so an extra £150 if you open 1 each for your wife and yourself, and one joint one. You need to ensure you meet the conditions though
£4.5K into TSB Plus accounts , 3% AER, on max £1,500 per account = £4,500

• 1 x TSB Plus in your name
• 1 x TSB Plus in your wife's name
• 1 x joint TSB Plus
• cycle £500 between the 3 accounts monthly

aroominyork

Risk is correlated with how long you want to invest for. Over 20 years equities can be lowish risk if you start de-risking into lower risk assets after 10-15 years, but they are very high risk if you need to access the money in 12-18 months since they won’t have time to recover from a crash which could happen the month after you invest or the month before you plan to withdraw. So is it worth the potential upside of x% (x = whatever you think you might gain) for a potential 40% downside?

You can also apply this to bonds: a cautious strategic bond might fall 10-15% (probably no more) but is that worth it for the upside?

If you want 5-10% with no capital protection you could look at peer to peer, but that sector is looking more iffy by the week.

MaxiRobriguez

You don't have a choice if you need the money back in 12-18 months. You should absolutely not subject it to capital risk and instead stick to best rate bank accounts (or multiple bank accounts with some smart standing orders).

Gadfium

bigstevex wrote: »

As the title says really, we have 20K we'll need back in ~12-18 months for an extension so we want to put it somewhere useful for this time.


Happy with Medium risk/unprotected capital suggestions. Higher rate taxpayer and currently don't have any form of ISA. Can spread the money across myself and wife too if it's more beneficial to use an ISA in some way?

Maybe read one or two of the million other threads that ask the variations on this question? There's usually a dozen or more threads like this posted every single month.

Ceme3000

If you need to guarantee getting the money back in 18 months then only savings accounts fit your retirement. For a very very slim chance of making some money try premium bonds. You never know!

daveyjp

For an easy life. Half in Marcus, half in Premium bonds.