Pensioner savings

my_mum

My mum receives state pension and no other income. She has £1100 she wishes to place in a savings account with the ability to add small ad-hoc amounts through the year. Suggestions for the best option - a cash ISA perhaps?

margaretclare

According to Martin with his 'Money Fountain' idea, everyone should max out their ISA allowance first, before other savings. Mum doesn't want to be paying tax on income on her savings, so an ISA would be the best option IMHO. Her £1100 plus extra amounts through the year would be fine - she's allowed £3,000 a year in terms of deposits.

Try the Yorkshire Building Society: https://www.ybs.co.uk Or any of the smaller building societies, all of whom have ISAs.

Does she want to do it online, because YBS have an E-ISA?

Best wishes

Margaret

Mikeyorks

Depends on her age. If she's 65+ then her allowances will likely comfortably exceed her income, particularly from 6th Apr 08.

ISAs are really long term savings vehicles. She may be better with an 'easy access' savings account? Whether that is 'online' (potentially better % rates) - or needs to be a Branch within travelling distance - you're better placed to decide?

EdInvestor

my_mum wrote: »

My mum receives state pension and no other income.

In that case she should apply for pension credit. The state pension is currently 87 pounds a week , so she would get an extra 32 pounds a week, plus free council tax.

She should apply asap, as at the moment she would get quite a lot of "back pay" - this back pay is going to be reduced as of next year for new applicants.The pension credit will go up to 124 pounds a week in April.