How to split cash savings

Who_invited_her

Due to recent retirement I have 240k to put into savings accounts. I have a good pension which is more than adequate for our needs and an emergency fund and no mortgage or other debts. I don’t have an ISA and have never had such a sum before. I am not comfortable 
with investments and am aware that inflation will erode the value of my savings. I will remain a higher rate tax payer due to pension and other income streams.

So I am planning to open an ISA for myself and husband, possibly 2 year fix just over 3%. Then divide the 200k into 4 and put 50k into a 2 year fix now (4%) and another 50k in the best one year fix now, or in the next week or so. Then wait a couple of months and do the same with the other 100k being careful to ensure I don’t have more than 85k in any banking group. In the meantime the money will be in an easy access account. Currently it is in an account paying 1.35%, I know it’s not the best but it is an account I already had. I expect to save enough to fund a new ISA in April separate to these savings. Is this the best strategy? Should I hold off funding the ISAs for a month or two? I guess if I hold off I am losing in the short term anyway and the same with waiting to fix the second 100k but in a rising interest environment this seemed sensible. Partner is a basic rate tax payer so plan is to put the non ISA savings in his name, married nearly 40 years and no problem with trust issues. Does this plan sound sensible and have I missed anything? Thanks

Who_invited_her

Anyone? Just wanting to check I haven’t missed anything obvious? I found out today the easy access account is 1.55% rising to 1.85% on 7th Oct so happy with that for easy access emergency fund and holding money until I fix. 

Albermarle

You can not add more than £20K to an Isa per tax year.


You as a higher rate taxpayer can earn £500 in interest without paying any tax.

Your partner can earn £1000 in interest without paying any tax, unless they earn less than £18,570pa then they could possibly earn more.

It looks like you will have to pay tax on quite a lot of the interest . £240K at 3% = > £7K

Bigwheels1111

First put the spare cash into Al Ryan at 2.1%if they raise rates it automatically add to you account.
Not more than £84800, then move interest each month to another savings account.
Then you can’t loose out as within 85k limit.
Gatehouse is 2% easy access.
Have a look and moneyfacts and 1,2,3 year etc make sure you untick the box top right for all options.
first click savings and isa, then what type you want.

https://moneyfacts.co.uk/

As I don’t pay tax until rates hit over 6% I’m not sure on what to do with isa etc as dumped mine for better rates.
1

MX5huggy

What sort of pension was it? DB (final salary) or DC?

if the former you could contribute all your earned income this year to a pension. 

Same for your husband? Working? 

Who_invited_her

The 40k into ISAs would be one each as neither have any at the moment. Husband not working. I know we will pay tax on savings but planning to put in husbands name as he is a basic tax payer and I am a higher tax payer. Was concerned that  a 2 year fix might be a little long and may be better putting the rest in 1 year fixes or should I spread it between the two?