Sale Deposit 1 Month?

port_buy

We are likely to have > £100,000 from equity sale for our house and won’t complete on our new build purchase for 1-2 months. 

I’m thinking of maxing two premium bond accounts for the entire of Feb in the hope of some winning. Has anyone got a better idea for such a short time? 

RobfromCornwall

Don't forget that premium bonds have to be in for a full calendar month before they are entered for any draws.  My instinct is this isn't a very good idea for the very short term.  I'd also call NS&I easy(ish) access, rather than instant access, which might be important for a house purchase.  

masonic

You can still get north of 5% from several easy access savings options as opposed to at least a full month at 0% from premium bonds. Have you checked whether your money would qualify for temporary high balance protection from FSCS? Suspect not, in which case you'd only need to split between two sole accounts or hold in a joint account.

port_buy

We’d be covered by temporary high balance but would likely get a joint account regardless.

5% easy access would give us £400ish. 

Would you have concerns about 1 or more new accounts with other providers being opened around mortgage offer time? None would be credit of course. 

If premium bonds we both have an account already, can achieve a full month and have a long enough notice period in contract for withdrawal. 

badger09

masonic said:

You can still get north of 5% from several easy access savings options as opposed to at least a full month at 0% from premium bonds. Have you checked whether your money would qualify for temporary high balance protection from FSCS? Suspect not, in which case you'd only need to split between two sole accounts or hold in a joint account.

BIB Why do you ‘suspect not’?

boingy

Yeah, Easy Access is the way to go or maybe a Cash ISA if other savings interest might take you into tax territory.

masonic

badger09 said:

masonic said:

You can still get north of 5% from several easy access savings options as opposed to at least a full month at 0% from premium bonds. Have you checked whether your money would qualify for temporary high balance protection from FSCS? Suspect not, in which case you'd only need to split between two sole accounts or hold in a joint account.

BIB Why do you ‘suspect not’?

It was unclear what is meant by "equity sale for our house". Depending on what was sold, it may or may not have protection. For example, if it was an equity release from the current main residence it would be protected. Sale of equity in most other assets would not be covered. Seemed odd to do an equity release in the final stages of the build and then not use the money until completion. But equity release from main residence must have been what was meant.

masonic

port_buy said:

Would you have concerns about 1 or more new accounts with other providers being opened around mortgage offer time? None would be credit of course. 

If premium bonds we both have an account already, can achieve a full month and have a long enough notice period in contract for withdrawal. 

Opening savings accounts will not result in a credit search.

Regarding the Premium Bonds, it doesn't matter whether or not you already have an account, you'd need to buy the new bonds on or before the 31st January for them to qualify for the March draw. If you are a basic rate taxpayer, this will result in a lower return than a 5% savings account for someone with average luck even assuming all of the interest will be taxed (median return on two full holdings over 12 months will be ~3.9% from March, but less - more like 3.5% - if holding for a single draw). If you miss 31st January, or need the funds back in your bank account before ~6th March, you would get a guaranteed zero return from the PB.

port_buy

Thanks all. It is from the sale of our main residence. We’ll go for an easy access savings account for the duration as won’t hit tax thresholds on interest. 

jimjames

port_buy said:

Thanks all. It is from the sale of our main residence. We’ll go for an easy access savings account for the duration as won’t hit tax thresholds on interest. 

Even if you do reach that threshold it's still worth paying tax to get a decent amount of interest

badger09

@masonic
Thanks for explanation. I’d just assumed, correctly as it turns out😊, that it was just odd wording by OP meaning equity from sale.