Premium Bonds or Savings Account for additional rate taxpayer?

shoe_dog

I've got £80k that i'd like to put aside as accessible savings for a short-term goal.

As an additional rate taxpayer with no personal allowance and the 2022/23 ISA limit already reached, would you put the £80k into a savings account with the best current rate (i.e. Chase at 1.5%) given the interest will be taxed? Or £50k into premium bonds and £30k into a savings account?

MX5huggy

Presuming “short term” equals a number of months. Then PB’s it’s worded as if the blue stick men win but the yellow team is significantly bigger. 

Albermarle

Or £50k into premium bonds and £20k into a savings account?

What would be the plan for the remaining £10K ?

MX5huggy

Albermarle said:

Or £50k into premium bonds and £20k into a savings account?

What would be the plan for the remaining £10K ?

That’s our commission. 

shoe_dog

Albermarle said:

What would be the plan for the remaining £10K ?

Typo! 

shoe_dog

MX5huggy said:

Presuming “short term” equals a number of months. 

Accessible within the year. There might be a few notice-period saving accounts that beat 1.5% slightly but i just wanted to get a rough idea based on the best instant access account.

The premium bonds calculator you used only allows you to select non-taxpayer, basic rate or higher rate tax payer whereas i'm an additional rate payer (no personal allowance), are the results therefore slightly skewed?

MX5huggy

The “months” was referring to the fact you need to hold them for a calendar month before they go in the draw so buy tonight (with a debit card) they will be in the draw on August 1st buy tomorrow it will be September 1st but if you withdrew the money on August 31st you would have had them nearly 2 months but not actually been in a draw at all guaranteeing no return! 

Not sure on additional rate is that 45%? But interest at 1.5% on £50k is £750 Gross. The calculator says that’s £450 net for a higher rate tax payer so if you’ll get less than £450 net, the PB’s are even better. 

shoe_dog

MX5huggy said:

The “months” was referring to the fact you need to hold them for a calendar month before they go in the draw so buy tonight (with a debit card) they will be in the draw on August 1st buy tomorrow it will be September 1st 

Doh! If only i'd read this last night    Oh well, better late than never i guess?

MX5huggy

shoe_dog said:

MX5huggy said:

The “months” was referring to the fact you need to hold them for a calendar month before they go in the draw so buy tonight (with a debit card) they will be in the draw on August 1st buy tomorrow it will be September 1st 

Doh! If only i'd read this last night    Oh well, better late than never i guess?

Well now there’s no point buying them till the end of July so I suppose a lot later is now better than late. You’ll earn about £30 net interest waiting till the 25th or something. (Set up the account and do a small transaction before). 

shoe_dog

MX5huggy said:

Well now there’s no point buying them till the end of July so I suppose a lot later is now better than late. You’ll earn about £30 net interest waiting till the 25th or something. (Set up the account and do a small transaction before). 

The money's currently sitting in a Barclay's Everyday Saver at a pitiful 0.01%. Do you mean move the £80k into the Chase account now (1.5%), then move £50k of that into PB's on the 25th?

MX5huggy

shoe_dog said:

MX5huggy said:

Well now there’s no point buying them till the end of July so I suppose a lot later is now better than late. You’ll earn about £30 net interest waiting till the 25th or something. (Set up the account and do a small transaction before). 

The money's currently sitting in a Barclay's Everyday Saver at a pitiful 0.01%. Do you mean move the £80k into the Chase account now (1.5%), then move £50k of that into PB's on the 25th?

Yes, if you’ve got the Chase account open move the £80k today. But it took my wife 3 weeks to get to the front of the Q to open the Chase account this week. I opened mine the month before in about 2 hours.