Best Low-Maintenance Strategy for £28,000 Savings?

bluehighlighter

Hi everyone,

A parent of mine recently passed away, and I’ve inherited £28,000 in savings. I’ve never had substantial money before, so I want to take a low-risk, low-maintenance approach while keeping some funds accessible.

After researching online and reading posts on this forum, I’ve put together the following plan. I’d really appreciate any opinions, feedback, or potential red flags!

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My Proposed Savings Strategy

Purpose	Amount	General Account Type	Access Level	Option 1	Rate	Withdrawals	Notes
Emergency Fund	£6,000	Easy-Access Savings Account	Fully accessible	Trading 212 - Easy-Access Cash ISA	5.03%	Unlimited, Penalty-Free	Tax-free interest
Medium-Term (1 Year)	£10,000	1-Year Fixed-Term Bond	Locked (12 months)	GB Bank - 1-Year Fixed Bond	4.75%	Locked	Interest paid monthly or at maturity
Medium-Term (2-3 Years)	£5,000	2-3 Year Fixed-Term Bond	Locked (24-36 months)	Atom Bank - 2-Year Fixed Term	4.60%	Locked	Interest paid monthly, annually, or at maturity. Access via app
Long-Term Savings	£8,000	NS&I Premium Bonds	Fully accessible	NS&I Premium Bonds	N/A	Fully accessible	Potential tax-free prizes, but no guaranteed return

trickydicky14

bluehighlighter said:

Hi everyone,

A parent of mine recently passed away, and I’ve inherited £28,000 in savings. I’ve never had substantial money before, so I want to take a low-risk, low-maintenance approach while keeping some funds accessible.

After researching online and reading posts on this forum, I’ve put together the following plan. I’d really appreciate any opinions, feedback, or potential red flags!

---

My Proposed Savings Strategy

Purpose	Amount	General Account Type	Access Level	Option 1	Rate	Withdrawals	Notes
Emergency Fund	£6,000	Easy-Access Savings Account	Fully accessible	Trading 212 - Easy-Access Cash ISA	5.03%	Unlimited, Penalty-Free	Tax-free interest
Medium-Term (1 Year)	£10,000	1-Year Fixed-Term Bond	Locked (12 months)	GB Bank - 1-Year Fixed Bond	4.75%	Locked	Interest paid monthly or at maturity
Medium-Term (2-3 Years)	£5,000	2-3 Year Fixed-Term Bond	Locked (24-36 months)	Atom Bank - 2-Year Fixed Term	4.60%	Locked	Interest paid monthly, annually, or at maturity. Access via app
Long-Term Savings	£8,000	NS&I Premium Bonds	Fully accessible	NS&I Premium Bonds	N/A	Fully accessible	Potential tax-free prizes, but no guaranteed return

I make that 29k? Otherwise if you only wish to keep your money in cash and forget about it, it looks a sensible approach. 

Alexland

Have you considered yet what you will use the money for?

Generally it's best to try and align savings/investment choices with objectives. 

InvesterJones

As above - risk can't really be measured without understanding objectives and time frame in particular (something that seems volatile in the short term may smooth out in longer term, and likewise there are inflation/opportunity risks to consider). As is though, and since you mention tax-free for the premium bonds, your tax status may affect choices even in the short term - the 1-3yr fixes could be considered alongside gilt alternatives - after tax they may give better return, with easier accessibility if needed in an emergency.

bluehighlighter

Thanks Alexland and InvestorJones, I have no real plans for the money and have no savings outside of it. I just want to put it somewhere safe in the meantime, with some accessible incase of an emergency. 

InvesterJones

It sounds like a good chunk of this will form your emergency fund then, in which case keep that in an easy access cash ISA (and if you don't have enough ISA allowance remaining, keep the remainder in an easy access account ready to put into the ISA in the new tax year). Then for the rest try and think of a timescale when you'd want to access it - if you can't think of anything then putting it into pension is often a good move - you've got any emergencies covered with your easy access, so shouldn't be a problem putting it away.

Bobblehat

Not a red flag, but, as you've indicated a couple of tax-free options, and not knowing if you've used any of this year's ISA allowance, or are likely to pay any tax on interest earned (you could be a low earner?). I was wondering why you've decided to put just £6K into an ISA? Could £20K ISA allowance this tax year plus £20K ISA allowance on 6th April be attractive to you? How relevant is the tax-free status to your particular financial circumstances?

Albermarle

After researching online and reading posts on this forum, 

As you have been reading the forum, you will not be surprised that some posters are suggesting you look at some investments/pension for the longer term.
These can also be very low maintenance as well, so fits with your original objectives.

tonypyorkshire

Having recently been in a similar situation myself (my Dad passed away in late 2023) I think this looks very sensible.

I've also invested in a S&S ISA too for retirement (10 years away) and maxed out pension contributions where I could.

Good luck and condolences on your loss of your parent.

n15h

As other posters have said, it is sensible to think about when you will want access to the money and maximise the use of tax efficient products like ISAs, pensions, premium bonds, etc.

Locking the money for 2 years depends on your circumstances, but your proposals show the easy access rate is currently beating the 2-year fix.

It's good you've thought about an emergency fund - there is guidance to keep 3-6months worth of expenses in there (some say even up to 12months worth). Base it on your own lifestyle and what gives you peace of mind knowing you've have enough to cover you when you need it the most.

Also consider a flexible ISA - i think the Trading 212 ISA in your proposal offers this. Allows you to withdraw money in a tax year and then replace it in the same tax year without reducing your ISA allowance for the tax year. 

To keep it low maintenance, my own view is 3 pots - an emergency pot (ISA and/or premium bonds), a short term pot (easy access e.g., for a holiday, car repairs etc.), and a long term pot (pension and/or stocks & shares ISA/lifetime ISA e.g., for retirement or house deposit).