Savings opinions on my situation.

Jimmypop64

Good morning,

I am after some opinions what i should do in my situation regarding my finical position.

My situation -  I am 43 years old. I am married, 2 young children with my own home. I earn £70,000 annually and receive a tax free monthly pension of £1100. 

Debt -
Mortgage - £300,000 at 1.54%, rate runs out Oct 27. From Oct 27 £250,000 will be owed. 

Current savings -
£50,000 in Premium Bonds.
(Annual £20,000 tax free allowance used) in £4,000 in LISA and £16,000 in Cash ISA.

£34,000 remaining. This money is just floating around accounts with no real interest. 

What should i do with the remaining £34,000?

I am quite new to looking after my money properly.

Thank you in advance for any advice. 

p00hsticks

You don't mention your pension provision ?
If you don't have any plans for the money short term, additional pension contributions are usually very tax effective

Albermarle

If you are likely to need the money in the next few years, then there are many savings accounts to choose from.
Compare The Best Savings Accounts UK | Rates Up To 8% (moneyfactscompare.co.uk)

If you are wanting to build up a pot for a good/early retirement, then adding it to your pension is usually the best bet. Presume you have one with your employer? With your salary you will also benefit from very generous 40% tax relief ( until budget day at least )

El_Torro

A good place for money not in cash is either a Stocks & Shares ISA or your pension. Since you earn £70k it's a good idea to put enough in your pension to get tax relief on any money you would have paid 40% tax on. 

You have £90k in cash. Is this too much? Normally someone your age in employment would keep between 3 months and 6 months worth of expenditure in cash, known as an emergency fund. The rest can be invested (ISA or pension). 

Your monthly mortgage payments are likely to shoot up in 3 years time, due to higher interest rates. Is it worth keeping some money in cash and reducing the balance of your mortgage when the 1.54% rate runs out?

Jimmypop64

Thank you for all the feedback, I appreciate it. 

I have a workplace pension too. 9% matched by my employer, this comes in around £590 a month contribution.

Albermarle

Jimmypop64 said:

Thank you for all the feedback, I appreciate it. 

I have a workplace pension too. 9% matched by my employer, this comes in around £590 a month contribution.

Have you thought about putting in a higher %?
Even if your employer will not match, you will still be getting 40% tax relief.

enthusiasticsaver

I would look at pension provision for you and your wife and stocks and shares isas.  When the mortgage is due up the rate will increase so I would then focus on overpaying that too.