How many accounts is too many?

oscar2291

Hi everyone

I recently have received a fairly significant pay rise which coincides with paying off a few debts and loans. I will now have a good amount to add to savings monthly.

I already put roughly £300 a month into Premium Bonds as well as £150 into my Nat West Digital Savings account (max for this account). 

I'm now torn between adding the extra amount I will have into my premium bonds or should I get a Stocks and Shares ISA (Vanguard or similar) to invest in? I understand the risk with this, but is still a good option. 

I don't know if splitting my money between premium bonds, a high interest savings account as well as an ISA is too much? Am I better distributing or consolidating?

Any thoughts would be welcomed!

Best regards and thanks,
O

subjecttocontract

Mortgage ?
Pension ?
Debts ?

Cisco001

I won't bother Premium bond until annual interest over allowance. 

eskbanker

oscar2291 said:

I don't know if splitting my money between premium bonds, a high interest savings account as well as an ISA is too much? Am I better distributing or consolidating?

Any thoughts would be welcomed!

Much will depend on when you're anticipating needing the money, together with the rest of your financial circumstances - you might find this helpful in assessing options:

The Flowchart - UKPersonalFinance Wiki

oscar2291

Thank you all.
I have a workplace pension which I contribute 5% to already.
No mortage currently. Ideally I would save to purchase property but don't necessarily want a help to buy ISA which restricts to this use incase anything changes. 

Kim_13

A Help To Buy ISA isn’t restricted to withdrawals for a qualifying property purchase or when over 60 - that’s the Lifetime ISA. If you have a Help To Buy ISA, it’s worth fully funding (£200 per month, with £12,000 saved qualifying for the maximum available bonus.)

As you hold the NatWest Digital Regular Saver, you must have a current account with them but do you also have a secondary current account elsewhere with some funds in in case of a system issue or a temporary account freeze at NatWest? Starling, Virgin Money M Plus and Chase will pay some interest on this (and Chase cashback on spending too.) 

How many accounts is too many will depend on whether you are a spreadsheet person (making it possible to manage more without a problem), how easy you find it to remember where your money is/needs to go etc. 2 current accounts, 1 Regular Saver, 1 Easy Access Savings, 1 Cash ISA (which Help to Buy is a subset of), 1 Stocks and Shares ISA and Premium Bonds would be a fairly standard starting point.

With rates expected to fall, it might be best to open as many fixed rate Regular Savers as you can. Principality Building Society (£50 per month at 6% and £250 per month at 5.5%) and Halifax (also up to £250 at 5.5%) are open to everyone. You would then max these before funding the PB’s further, though if you are a higher rate taxpayer it might well be worth switching to PB funding as soon as your interest is projected to exhaust your PSA. Are you a member of any building societies currently?

Hoenir

Do you have a sufficient emergency cash buffer to tide you over in the event of unexpected outgoings or loss of income?  Best to save first rather than invest. Borrowing money soon eradicating any gains. While avoinding the fact that investing can lose you money in the short term. 

Mark_d

I think there are advantages in keeping things simple.  My first priority is pension savings, to which I contribute 35% of my salary.  I then have an easy access savings account, Premium Bonds, and an S&S ISA.

The easy access savings account is for general savings - unexpected expenses.  The premium bonds are the 'safe' element of my portfolio which doesn't incur tax.  The S&S ISA is where I'm looking to grow wealth so that I can repay my mortgage long before I retire.

oscar2291

Kim_13 said:

A Help To Buy ISA isn’t restricted to withdrawals for a qualifying property purchase or when over 60 - that’s the Lifetime ISA. If you have a Help To Buy ISA, it’s worth fully funding (£200 per month, with £12,000 saved qualifying for the maximum available bonus.)

As you hold the NatWest Digital Regular Saver, you must have a current account with them but do you also have a secondary current account elsewhere with some funds in in case of a system issue or a temporary account freeze at NatWest? Starling, Virgin Money M Plus and Chase will pay some interest on this (and Chase cashback on spending too.) 

How many accounts is too many will depend on whether you are a spreadsheet person (making it possible to manage more without a problem), how easy you find it to remember where your money is/needs to go etc. 2 current accounts, 1 Regular Saver, 1 Easy Access Savings, 1 Cash ISA (which Help to Buy is a subset of), 1 Stocks and Shares ISA and Premium Bonds would be a fairly standard starting point.

With rates expected to fall, it might be best to open as many fixed rate Regular Savers as you can. Principality Building Society (£50 per month at 6% and £250 per month at 5.5%) and Halifax (also up to £250 at 5.5%) are open to everyone. You would then max these before funding the PB’s further, though if you are a higher rate taxpayer it might well be worth switching to PB funding as soon as your interest is projected to exhaust your PSA. Are you a member of any building societies currently?

This is very helpful thank you! I had looked into Chase briefly but never went any further. I haven't looked into building societies previously which I will do. I am in the higher tax rate as you noted too.
I'm also very much a spreadsheet person so happy to manage the accounts. I just wasn't 100% sure if it was best to spread the money rather than consolidating. 
Thank you for your time responding.
O

oscar2291

@Hoenir

Yes I do. I also have an easy access savings account which I didn't reference above sorry. This currently has approx 1 month salary which I should probably add to. T

his was referenced via a weblink on another suggestion which is great advice.

Thank you all for your help!
O

Albermarle

oscar2291 said:

Kim_13 said:

A Help To Buy ISA isn’t restricted to withdrawals for a qualifying property purchase or when over 60 - that’s the Lifetime ISA. If you have a Help To Buy ISA, it’s worth fully funding (£200 per month, with £12,000 saved qualifying for the maximum available bonus.)

As you hold the NatWest Digital Regular Saver, you must have a current account with them but do you also have a secondary current account elsewhere with some funds in in case of a system issue or a temporary account freeze at NatWest? Starling, Virgin Money M Plus and Chase will pay some interest on this (and Chase cashback on spending too.) 

How many accounts is too many will depend on whether you are a spreadsheet person (making it possible to manage more without a problem), how easy you find it to remember where your money is/needs to go etc. 2 current accounts, 1 Regular Saver, 1 Easy Access Savings, 1 Cash ISA (which Help to Buy is a subset of), 1 Stocks and Shares ISA and Premium Bonds would be a fairly standard starting point.

With rates expected to fall, it might be best to open as many fixed rate Regular Savers as you can. Principality Building Society (£50 per month at 6% and £250 per month at 5.5%) and Halifax (also up to £250 at 5.5%) are open to everyone. You would then max these before funding the PB’s further, though if you are a higher rate taxpayer it might well be worth switching to PB funding as soon as your interest is projected to exhaust your PSA. Are you a member of any building societies currently?

This is very helpful thank you! I had looked into Chase briefly but never went any further. I haven't looked into building societies previously which I will do. I am in the higher tax rate as you noted too.
I'm also very much a spreadsheet person so happy to manage the accounts. I just wasn't 100% sure if it was best to spread the money rather than consolidating. 
Thank you for your time responding.
O

Two separate issues/questions being mixed together here.

Question 1 - Should I hold multiple savings accounts, multiple current accounts, multiple investment accounts, multiple pensions? The answer is that some people do because they are chasing the best deals all the time.
Whether the extra admin/work is worth it is a personal choice.

Question 2 - Should I hold different types of accounts that will satisfy different objectives, mainly related to time scales? For example a savings account for the short term, an investment account for the medium term and a pension for the long term . Answer - Normally Yes

 I am in the higher tax rate 

Then you should seriously consider adding more than 5% to your pension due to getting higher rate tax relief. The gift that just keeps on giving !