What saving account is ideal for my savings? (£7,968)

LostSoulUK

Hi, I posted this elsewhere but its worth posting here. I've only just explored savings accounts, regrettably I wish I did this much sooner but was so confused by all the jargon. I now have more of an understanding to maximise interest rates but I'm still confused what to do exactly. Apparently Plum has the best interest rate at over 7% including a 3 month bonus rate of 2.5% provided there's a limit to 4 withdrawals a year.

But then the return came out at like 40 quid annually which doesn't justify the means it seems unless that is somehow distributed evenly across 12 months. Then I saw some societies with less interest rates that offer around £30 monthly interest on 1k deposit. My auntie apparently receives 100 monthly from Skipton but I don't understand how. My TSB bank account offers around 20 a year interest which doesn't seem worth it at all.

Its a lot to get my head around as this is all new to me. I'm assuming a fixed account is the best course of action based on my savings. I get my rent paid for me as I don't work atm but I have a lot of bills to pay each month. A monthly return would essentially pay off 1 bill which I would take but I want to maximise what I can get based on my total savings. I'd be willing to let it build over time if its worth it in the long run, there's just so much terminology to get my head around. Any advice would be welcome just to get a bit of perspective on the best course of action .

caeler

If you need the money go easy access. Check here for the best rates. https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/#easyaccess

If you put £8K in Atoms reward saver, you’ll get around £31 interest a month. Interest rate goes down if you withdraw but you can access the money whenever. 

sammy_zammy

I think you need to stop looking at random numbers other people happened to have earned from their own savings, or the numbers banks give on an example £1000…

Interest rates are percentages. Banks will pay you that percentage of your own money over a year, which you can choose to have paid annually or monthly. Pick the highest number and earn the most money. (No idea where you got Plum being 7%, or giving an annual return of £40, from…)

If you only have £7968 to save are you sure limiting yourself to 4 withdrawals a year is the right choice for you? I would just go for an easy access or flexible account, such as Trading 212 which has a 0.12% lower rate (amounting to £2.39 over the 3 months). Even then, the 3 month bonus won’t amount to much. You won’t be paying tax on your savings interest, so don’t feel you have to use an ISA either, which are slightly awkward and slow to transfer - possibly not ideal for your entir savings.

LostSoulUK

sammy_zammy said:

I think you need to stop looking at random numbers other people happened to have earned from their own savings, or the numbers banks give on an example £1000…

Interest rates are percentages. Banks will pay you that percentage of your own money over a year, which you can choose to have paid annually or monthly. Pick the highest number and earn the most money. (No idea where you got Plum being 7%, or giving an annual return of £40, from…)

If you only have £7968 to save are you sure limiting yourself to 4 withdrawals a year is the right choice for you? I would just go for an easy access or flexible account, such as Trading 212 which has a 0.12% lower rate (amounting to £2.39 over the 3 months). Even then, the 3 month bonus won’t amount to much. You won’t be paying tax on your savings interest, so don’t feel you have to use an ISA either, which are slightly awkward and slow to transfer - possibly not ideal for your entir savings.

I just regret not earning some interest on my savings all these years, just letting it sit in my tsb account. At 1 point last year my savings were around 15k as I got made redundant as a TA, they basically paid me off around 8k. I then moved out for the 1st time in october and spent a few thousand on fixtures and fittings at the new flat.

Currently I get my rent paid for me £450 monthly as I'm on universal credit which includes communal heating system. I also receive around 400 from the standard rate of Universal credit payment, my income is around £780.93 total a month. The universal credit payment basically all goes on monthly bills (Council tax 110, Octopus energy 60, Water 29, Tv licence 28.25, Virgin fibre broadband 25, Now Tv 11, O2 contract 6 p/m). Then shopping as and when pretty much, can last me a month but basic essentials like bread and milk every week + kitten food and litter like once a month. I've also just pre-ordered the switch 2 and a tv (can't help myself). 

Just sent off a form in relation to my mental health which affects my ability to work full time in many ways so I'll have see how that turns out. Based on these circumstances what would you say I should do? like you said a flexible ISA is a reasonable choice for most. Even in the worst case scenario the housing association supports tenants in council houses, tenants rarely get evicted from social housing unless oc anti social or rent arrears but I'm covered for rent and bills, haven't missed any payments. I was so close to moving to private rented last year but the cost was more significant and less security. 

I'm not good with figures tbh this is why all this savings jargon is a bit confusing, there's not 1 unanimous choice for various reasons. Now I'm being told elsewhere on reddit that 7% doesn't exist despite Plum offering as much. I've no idea how much savings each month I should put aside, some say 100 some say deposit 1k, its all a mind !!!!!!, just want the maximum return I can get tbh.

Bigwheels1111

I would use 2 options.

1,  Trading212 ISA near instant deposits and withdrawals via open banking. Stick all the cash in there.

2, regular savers with your bank or building societies. below click link then, Sort, select Rate

https://moneyfactscompare.co.uk/savings-accounts/regular-savings-accounts/?quick-links-first=false&product-favorites-first=false&sort-order=AER&sort-order-text=Rate

Principality BS 6 Month Regular Saver Issue 3, 7.5%

Market Harborough BS Fixed Term Regular Saver (31.03.2026 ) 6.0%

West Brom BS Fixed Rate Regular Saver (Issue 7) 6.0%

Progressive BS Online Regular Rainy Day Saver Account (Issue 3 ) 5.75%

You keep the cash in the ISA until you need to fund the reg savers.

To max your interest.

If you don't understand how regular savers interest work you need to look into it.

Basically if its £200 a month, you get 7.5% interest on £200 in month 1, Then 7.5% on £400 and so on.

It does not look very good but it is, It's 7.5% interest.

I have 19 running this month, drops to 17 next month as two have matured or are this month.

£1378.09 last year in interest from reg savers.

£ 600.00 from leaving the rest of the cash in an ISA and easy access accounts.

GrumpyDil

Simply put you need to look for the accounts that pay the highest interest rates but meet your needs in terms of being able to withdraw the interest if you need it etc.

LostSoulUK

Was just about to touch on regular savings as my TSB bank account offers a 'savings pot' which I assume is their term for a regular savings account. They've offered it to me a few times but I never looked into it and 1.5% seemed pointless, I could !!!!!! in a pot for more than that. 

Now that you mention, it seems worth looking into to combine with an ISA from another society with higher rates. I guess the regular savings with TSB would save me switching bank accounts which I never considered as I already found TSB reliable with fraud and such. There's just so many ISA's and societies to choose from, some say Plum, others say Kent reliance. If the highest interest rates are the metric we should go off, why doesn't everyone just plump for plum (pun intended). 

redpete

Bigwheels1111 said:

I would use 2 options.

1,  Trading212 ISA near instant deposits and withdrawals via open banking. Stick all the cash in there.

2, regular savers with your bank or building societies. below click link then, Sort, select Rate

Given the OP's level of understanding those options are too complicated. I have lots of accounts and find Trading 212 not at all easy to manage. Managing multiple RSs seems far to complicated a process.

The OP doesn't really know when they might need to withdraw from their savings so I would look for the highest paying easy access and multi-access savings account with straightforward online access.

Maybe Charter Savings Bank at 4.59%, or Post Office at 4.4% and review after 1 year when the big bonus finishes.

LostSoulUK

redpete said:

Bigwheels1111 said:

I would use 2 options.

1,  Trading212 ISA near instant deposits and withdrawals via open banking. Stick all the cash in there.

2, regular savers with your bank or building societies. below click link then, Sort, select Rate

Given the OP's level of understanding those options are too complicated. I have lots of accounts and find Trading 212 not at all easy to manage. Managing multiple RSs seems far to complicated a process.

The OP doesn't really know when they might need to withdraw from their savings so I would look for the highest paying easy access and multi-access savings account with straightforward online access.

Maybe Charter Savings Bank at 4.59%, or Post Office at 4.4% and review after 1 year when the big bonus finishes.

Should I just go with my existing TSB regular savings pot even though its 1.5% then add an ISA from say Monzo or somethin which everyone seems to love. I'm unfamiliar with the process but I guess you just put aside 50-100 each month into an ISA + maybe a lump sum into a TSB savings pot to watch it grow so to speak. Although I believe its best to deposit lump sums in fixed accounts.

Maybe in general, up to 100 is reasonable to get say 30 interest a month or something, more would be nice for bills but its somethin. Maybe the higher the interest rate the less you have to deposit to get a worthwhile return. At 1.5% TSB seems lousy but I guess its better than just letting my savings sit and wilt in my primary TSB account.

A lot of these savings accounts are deceptive with their bonus rates, making you believe that's the total base rate like with Plum, yesterday they were showing 7.5% rates + 2.5% bonus rate or something, which led me to believe me this was by far the best option, now its dropped all of a sudden to 3.54% + 2.14%. This also shows how variable rates go up and down at the drop of a hat. If anything I've learned so much on all this the past few days, but still confused with a lot of it.

I'm as close as ever to opening my 1st savings account in my mid 30s, I just now want to get the ball rolling. If there wasn't so many ISA's to choose from I wouldn't be so confused, I get overwhelmed by choice to the point were I spend half an hour in a sweet shop or staring at my game library.

wmb194

LostSoulUK said:

Was just about to touch on regular savings as my TSB bank account offers a 'savings pot' which I assume is their term for a regular savings account. They've offered it to me a few times but I never looked into it and 1.5% seemed pointless, I could !!!!!! in a pot for more than that. 

Now that you mention, it seems worth looking into to combine with an ISA from another society with higher rates. I guess the regular savings with TSB would save me switching bank accounts which I never considered as I already found TSB reliable with fraud and such. There's just so many ISA's and societies to choose from, some say Plum, others say Kent reliance. If the highest interest rates are the metric we should go off, why doesn't everyone just plump for plum (pun intended). 

No, TSB has a one year 6% £250pm regular savings account. Instant access with no penalties.

https://www.tsb.co.uk/savings/monthly-saver.html

jimjames

LostSoulUK said:

 Then I saw some societies with less interest rates that offer around £30 monthly interest on 1k deposit. My auntie apparently receives 100 monthly from Skipton but I don't understand how. My TSB bank account offers around 20 a year interest which doesn't seem worth it at all.

There is no savings account that will pay £30 monthly interest on £1k, can you provide a link to what you have seen? That's £360 per year in interest so 36%, that's just not a possible return.
If your aunt receives £100 per month then she probably has £30-40,000 with them so your interest is going to be proportionate less as you have 1/7 of the money she has. However as mentioned above you can use regular savers which give higher rates and are much easier to handle with the amount you have compared to £30k.