Savings account versus life strategy 60% isa

Anng8

I have approx £30,000 in a savings account currently earning 4.75% interest. My Isa- (a similar amount) is now starting to show positive gain (currently ÷0.61%). Is it advisable to invest most into the isa now when I would be buying at a lower rate - or leaving it in the savings account until the interest rate drops?

Albermarle

It mainly depends on your personal situation. What are your objectives for the money/when do you think you might need it?
Also how do the savings and investments fit with your other finances e.g. pension provision, mortgage etc
Basically with knowing so little about you it is difficult to give a sensible answer.

Anng8

I am 74- so i know the isas are long term investments.....but i may not have that much life left?! I am in good health and pension etc enough to live comfortably with and no mortgage so do not envisage needing the savings.

newatc

If only we had a crystal ball. It is impossible to give much direction in your situation based on the information you have given and indeed my limited knowledge.

I can tell you that I am a 75 year old in reasonably good health and according to actuarial data, I'm expected to live until 87. I am in IHT territory and have 60% of saving in cash (easier for my beneficiaries to deal with IHT if I don't need it for care) and 40% in medium-risk investments which I would be surprised if I ever have to touch.

Whether my split is ideal or advisable, I have no idea but I'm comfortable with it.

Albermarle

Anng8 said:

I am 74- so i know the isas are long term investments.....but i may not have that much life left?! I am in good health and pension etc enough to live comfortably with and no mortgage so do not envisage needing the savings.

Without knowing all the detail, it would probably make sense to keep some as cash and some invested.
However with the cash part it could make sense to have some of it in fixed term/rate accounts if you do not need it in the shorter term ( for one , two, three years for example)
Assuming the 4.75% rate you mention is for an easy access account, then that rate will probably slowly reduce over the next year or two.
Compare The Best Savings Accounts UK | Rates from 7.00% (moneyfactscompare.co.uk)

Regarding your age, you should on average live another 12 years. However that is an average, and that means 50% will live longer. If you are healthy and have a good income etc you maybe well be part of that 50%,  and a surprising % of people do live into their early Nineties.