Where to put my lump sum

doownai

Hello All
Help and advice please, I have a lump sum of £15,000 that I hope not to 'dip' into. I've looked at locking it away for 1 or 2 years in a fixed rate account and the ''longer fixes'' 5 years Is the fixed rate account the way forward. I was going to lock it away for 1 yr and then looking for  the better % rate after that year or is 2yrs better. Also I can save  £200 per month from my current account to put away for a rainy day, again hoping not to dip into it, Can I put the £15000 in account where I can also put the £200 pm with it?
Thank you in advance
Ian

Pompeydave1967

Hi Ian , I would put away into a 1 yr or 2 yr fixed . Whether or not you wait for 1 more rise is down to you . You can add ££ into a fixed but there is usually a time frame. Saying that I’ve got a couple of fixed from a few months ago that I can still add to but they were low rates then and not worth it.

Bridlington1

I personally would not fix at this moment in time. In ordinary circumstances a fix would be the way to go but with interest rates rising so rapidly it would probably be worth sticking to variable rate accounts. If you do want to fix I would go for shorter fixes (6 months or less). I know a few people have began to use notice accounts as short term fixes by putting in a notice to withdraw funds as soon as they make their deposit.

I currently favour the option of putting your money in a high rate easy access account, then pouring this money into a series of regular savers. Most regular savers are either easy access, allow penalty free closure or have variable interest rates, meaning you can close the regular savers as and when the interest rate on a regular saver falls below the rate of your easy access account. I've got about a dozen regular savers on the go at the moment, all on this basis.

There's also the option of using some current accounts as savings accounts. For example if you've not has a Nationwide Flex Direct account before you can get 5% interest on £1.5k for the first 12 months, provided you pay £1k into it each month.

Daliah

Fixed term accounts don't really lend themselves for regular additions. Better look at Regular Saver accounts for your £200.

As to how long to fix your £15,000 for: personally, I wouldn't fix anything for more than 6 months at present since interest rates will almost certainly be rising over the next few months. I would just do a 6 months one and then fix again for 6 months or longer when the initial 6 months are up. Or you could split your money into, say, 3 lots of £5k, and fix one lot for 6 months, one for 9 and one for 12 etc etc.

If you aren't to bothered with rates, just go with the longest fix you can live with.

For most current rates, check https://moneyfacts.co.uk/savings-accounts/up-to-1-year-fixed-rate-bonds/?quick-links-first=false

george4064

@OP, when do you need the money? If it’s more than 5 years (preferably 10+) then you should consider investing your lump sum and making regular contributions with your £200 per month.

How is your pension looking too?

Albermarle

You can add ££ into a fixed but there is usually a time frame. Saying that I’ve got a couple of fixed from a few months ago that I can still add to but they were low rates then and not worth it.

Normally you have only 14 days to add more money, if you open a fixed rate savings account.

The ones where you can add money later are unusual/outliers.

Daliah

Albermarle said:

You can add ££ into a fixed but there is usually a time frame. Saying that I’ve got a couple of fixed from a few months ago that I can still add to but they were low rates then and not worth it.

Normally you have only 14 days to add more money, if you open a fixed rate savings account.

The ones where you can add money later are unusual/outliers.

Only one I am aware of that lets you add to some of their fixed term accounts, some of the time, are Shawbrook Bank.

Pompeydave1967

Daliah said:

Albermarle said:

You can add ££ into a fixed but there is usually a time frame. Saying that I’ve got a couple of fixed from a few months ago that I can still add to but they were low rates then and not worth it.

Normally you have only 14 days to add more money, if you open a fixed rate savings account.

The ones where you can add money later are unusual/outliers.

Only one I am aware of that lets you add to some of their fixed term accounts, some of the time, are Shawbrook Bank.

That’s correct , I have 2 Shawbrook fixed from a few months ago that will still let me add to.

doownai

Thanks for all the opinions everyone, was looking at shawbrook this morning, just looked now and Investec are offering more.