Saving Advice - £10k

maton91

Hello all,

I am 29 years old and I have the following pots of funds saved:

• 15% for a house deposit
• Funds to support house purchase and any home changes required after purchase
  
• £10,000 left over

I have £10,000 left over and I am looking for ideas/advice on what to do with it. I would like some to be saved rainy day in case of redundancy/urgent house fix etc (don't know how much exactly!) but pretty open to other suggestions on what to do with the rest if there is any. For example use some to increase LTV, better home improvement opputunities or even in premium bonds. If it helps I also have a stocks and shares ISA with MoneyBox which I deposit £50 weekly + roundups which is making me about 7% at the moment which is pretty good in the current climate I think! Also a company pension which I pay 8% and company pays 6% which I don't intend on changing.

All advice welcomed, I'm a bit green behind the ears at the moment until I have bought a property so I will listen to anything the wise and experienced owls on this forum have

Thanks in advance!

colsten

It sounds as if the £10K are pretty much your emergency fund, so you should keep it in readily accessible cash. Interest rates are dire across the board, so many people opt for Premium Bonds as they promise a potential average return slightly above the best interest rates, an off-chance big win, and relatively instant access (within 3 working days).

pbartlett

I would second premium bonds.

Stubod

..third for PB's..

maton91

colsten said:

It sounds as if the £10K are pretty much your emergency fund, so you should keep it in readily accessible cash. Interest rates are dire across the board, so many people opt for Premium Bonds as they promise a potential average return slightly above the best interest rates, an off-chance big win, and relatively instant access (within 3 working days).

pbartlett said:

I would second premium bonds.

Stubod said:

..third for PB's..

Thanks for your swift replies guys!

So premium bonds are something I know little without. My main query is if I lose out on anything. For example, if I use my £10,000 on premium bonds and I win nothing for 6 months, can I take back all of that £10k, or will I pay a penalty or lose out on anything?

Aceace

There's no risk to your capital in Premium Bonds. You can take your £10k back any time. 

colsten

https://www.moneysavingexpert.com/savings/premium-bonds/

DireEmblem

For ease of access, split your 10k 'emergency' fund across a couple of accounts.  You never know if/when a company server may go down for a few days at the worst possible time.

Virgin Money I think have a 2% account up to 1k.  RBS/Natwest have a monthly saver that pays 3% variable up to 1k, but you can only deposit £50 a month and access anytime.  The rest in PBs.

Congratulations on your house deposit.  I think the next step I would suggest, is that the lower LTV, the better mortgage interest rate you can negotiate, so plan in advance next steps - overpay mortgage, or invest any spare funds you may have once you have purchased over your 'emergency' fund.

cricidmuslibale

DireEmblem said:

For ease of access, split your 10k 'emergency' fund across a couple of accounts.  You never know if/when a company server may go down for a few days at the worst possible time.

Virgin Money I think have a 2% account up to 1k.  RBS/Natwest have a monthly saver that pays 3% variable up to 1k, but you can only deposit £50 a month and access anytime.  The rest in PBs.

Congratulations on your house deposit.  I think the next step I would suggest, is that the lower LTV, the better mortgage interest rate you can negotiate, so plan in advance next steps - overpay mortgage, or invest any spare funds you may have once you have purchased over your 'emergency' fund.

This is a very good post altogether imo!

Alexland

As above when you first become a homeowner it's worth having a bit of extra cash as when we moved into our current house the boiler unexpectedly had "do not use" british gas stickers on and there were a few more unexpected maintenance issues none of which showed on the survey but then it was a very good price so I shouldn't grumble.

TheEffect

Premium bonds are a good idea. 
My £10k emergency fund is kept with Virgin Money however, for the instant access (although PB isn't that long of a wait. I get 2% on 1k and 0.35% on the other 9k.