What would you do with the savings I have?

Rtj123

I’m a self employed sole trader. I have 2 current accounts, one for work income and one for personal payments  which I transfer money over from the work account to pay for living expenses, bills etc. I find this easier to keep track of my work money in and out.

I also have a ‘help to buy’ isa which I set up just before they stopped them. It currently only has £1 in it just to keep it going. I don’t own a property at the moment, I rent as I have a long distance relationship and we have yet to decide where we will live eventually.

I have 12k in a fixed ISA for 1 year at 4.45%, that ends mid next year. 

I also have a classic vehicle at around the value of 15k and a motorcycle worth around 3k but it also has a number plate on it which has been valued at 2k as a private plate if taken off the bike. 

I’m just wondering what would you do to make my money work more for me? Would you sell the vehicles and number plate and add it to the 12k and invest in something ? Or move the 12k to something more rewarding? If there is anything? Or keep things as they are?

Any views/ guidance I would appreciate.
Thankyou. 

tacpot12

The vehicle and motorcycle might go up in value, but if you keep them, you will need to factor somewhere to store them into your plans to buy a home. This might mean having to spend more, or limiting your choice of what sort of property to buy. 

You also need to have some fun and interest in your life. I might consider selling one of the two, or both if I consider that keeping them both is ultimately going to a problem. Better to get rid sooner if they are going to have to go. Selling while not under pressure to do so, also gives you the option of advertising them and waiting until you can get the  best price. If your partner is close to being able to come up with her half of the deposit, but you need £10-£15K to match their contribution, selling the car would be sensible as it will allow you to move forward with your plans, and a motorbike is easier to store. 

You should start funding the HTB ISA from income. You are potentially missing out on the government incentive if you don't. 

You should also look to put any spare income you have into your ISA to save for a deposit. Once you have enough for a deposit saved, switch to fund your pension to get the tax-relief. The tax-relief on your pension is worth more than what you will save by increasing the amount of deposit you can put down.  

The Fixed Rate ISA is in a good home. You won't get much more from it unless you select a riskier form of investment. As it is currently your only savings, I wouldn't do this. Focus on funding your HTB ISA and building up the deposit you need in your ISA. 

eskbanker

Rtj123 said:

I also have a ‘help to buy’ isa which I set up just before they stopped them. It currently only has £1 in it just to keep it going. I don’t own a property at the moment, I rent as I have a long distance relationship and we have yet to decide where we will live eventually.

If you're under 40 it would probably be worth opening a Lifetime ISA, which effectively superseded the HTB one - HTB ISAs can only be used to buy properties worth up to £250K (outside London, £450K within) provided you do so within the next six years, whereas LISAs can fund properties up to £450K across the UK and will continue beyond the closure of the HTB ISA scheme.

LISAs also have a more generous contribution allowance, but their downside is that there's a penalty for withdrawing your money other than for a first time property purchase (before 60) or within a year of opening, but even if you just open with a token £1 for now, it'll keep your options open while you consider your future property plans....

Rtj123

Thankyou both for your comments. That is a great help, I’ll look into opening a LISA.