Savings Advice for someone with no plan...

Degas

Good Afternoon,

I honestly have read most of the guides on here and am still lost what is best for me...I may in fact be a financial moron. I am sorry of this has been answered a million times previously.

I am looking for some advice please based on the following details...

1. I am a 48 year old guy.

2. I have a 25 year £147,000.00 interest only mortgage, with around 10 years left to run.

3. I earn around £62,500.00 a year.

4. I have around £95,000.00 in a free access current account with Halifax with awful interest, say 0.1% or similar.

5. My mortgage is around £660 a month with Santander.

6. I have no ISAs or other saving accounts

I am looking to probably move in the next 18 months and would like to maximise my savings, but as I don't know exactly when I will be moving, I need to ensure that any accounts have free access to the money in the account with no more than 30 days notice (without penalties) and I need to have at least one account with normal everyday access at high a rate of interest as possible. I would also like any interest to be paid monthly so I don't have to wait to the end of the year if I do decide to move...if that makes sense or how it works.

Can you assist with some advice please?

Thanks in advance

wjr4

Do you have a pension? If not, why? Could you swap to a repayment mortgage? 

Emmia

Well, I'd start by moving that £95k into better paying savings account(s). HSBC instant access is paying 2.25% and Chip 4.84% both are instant access

Do remember the £85k protection limit though.

Dazed_and_C0nfused

And if you could spare some for the longer term then additional pension contributions will be very tax efficient if your taxable income is the £62,500 you refer to.


3. I earn around £62,500.00 a year

grumbler

The first thing to do is to open an instant-access or 1-year fixed-rate cash ISA and stick £20K into it.

https://moneyfactscompare.co.uk/isa/easy-access-cash-isas/?quick-links-first=false

https://moneyfactscompare.co.uk/isa/1-year-fixed-rate-isas/

https://moneyfactscompare.co.uk/isa/18-month-fixed-rate-isas/

Then open another one or add £20K to the existing on the 5th of April.

MSE:  Top cash ISAs 2023/24

25_Years_On

What is the plan to pay off the mortgage?

Albermarle

 I have around £95,000.00 in a free access current account with Halifax with awful interest, say 0.1% or similar.

Can you be more careful with such statements on a MSE savings forum ! 

I imagine at least a couple of the regular contributors felt a bit faint after reading that 

xylophone

I imagine at least a couple of the regular contributors felt a bit faint after reading that  

Had to borrow some smelling salts....

That said, a relation of mine used to speak of a connection of his, a widowed lady whose late husband had adjured her to always have ready money available - she interpreted that as a five figure sum in her current account (which paid no interest)....

xylophone

 I have a 25 year £147,000.00 interest only mortgage, with around 10 years left to run.

How do you plan to repay it?

Do you have an occupational/private pension?

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

Do you have any dependants?

jimjames

The first priority is to move that money to an account that pays decent interest. That's nearly £5000 a year you're throwing away with the interest rate at the moment - pretty significant to most people!

boingy

Another question. What is the interest rate on your mortgage?

Also, put 50K of your savings into Premium Bonds. The prizes are tax free and I assume you are a higher rate tax payer.