Help needed! £60k in savings and don't know what to do!

Wallisboy09

Hi all

Sorry for the stupid post but I really could do with some help. I have just sold my house and have £60k equity saved off it. 

I do not need this money only to build upon it for buying our house together.

I don't need to withdraw ever off it for the longest period being 12 months and the shortest being 9-10 or 11 months. 

Where is best to keep this where I can lock it away and add to it whilst getting the best interest rates?

Thanks for your help! 

wmb194

Wallisboy09 said:

Hi all

Sorry for the stupid post but I really could do with some help. I have just sold my house and have £60k equity saved off it. 

I do not need this money only to build upon it for buying our house together.

I don't need to withdraw ever off it for the longest period being 12 months and the shortest being 9-10 or 11 months. 

Where is best to keep this where I can lock it away and add to it whilst getting the best interest rates?

Thanks for your help! 

If you're not exactly sure when you'll need it and certainly less than a year it might be better just to look at instant access accounts. It isn't all or nothing, though, you could have a mix of accounts and durations.

https://moneyfactscompare.co.uk/savings-accounts/

El_Torro

If you will be paying tax on some or all of the interest earned it might be worth looking at Cash ISAs or Premium Bonds for some of the money. 

Just on Premium Bonds, I would only recommend them to someone who would otherwise be paying 40% tax on interest.

mebu60

Assuming you're a basic rate tax payer and haven't used your £1k savings tax allowance and you want to avoid having to pay tax on interest from the £60k you could split it £20k into an easy access account, £20k into a cash ISA and £20k into premium bonds (which also assumes you've not contributed to an ISA this tax year nor in danger of exceeding the £50k premium bond maximum). 

RedImp_2

mebu60 said:

Assuming you're a basic rate tax payer and haven't used your £1k savings tax allowance and you want to avoid having to pay tax on interest from the £60k you could split it £20k into an easy access account, £20k into a cash ISA and £20k into premium bonds (which also assumes you've not contributed to an ISA this tax year nor in danger of exceeding the £50k premium bond maximum). 

Personally I wouldn’t be recommending this.  I know there are pro and anti premium bond posters but I think it’s safe to say if you’re going premium bonds then the best return is to max out.
Not sure if I understand correctly when you might want to access the money but perhaps as above but with the last £20k into a notice or fixed term account ?

mebu60

RedImp_2 said:

mebu60 said:

Assuming you're a basic rate tax payer and haven't used your £1k savings tax allowance and you want to avoid having to pay tax on interest from the £60k you could split it £20k into an easy access account, £20k into a cash ISA and £20k into premium bonds (which also assumes you've not contributed to an ISA this tax year nor in danger of exceeding the £50k premium bond maximum). 

Personally I wouldn’t be recommending this.  I know there are pro and anti premium bond posters but I think it’s safe to say if you’re going premium bonds then the best return is to max out.
Not sure if I understand correctly when you might want to access the money but perhaps as above but with the last £20k into a notice or fixed term account ?

The latter creates a restriction on access and also brings potential for tax liability into the equation. OP may want to avoid bringing hmrc into it if not already on SA. Otherwise, yes, as you suggest if restriction also not an issue. 

InvesterJones

mebu60 said:

RedImp_2 said:

mebu60 said:

Assuming you're a basic rate tax payer and haven't used your £1k savings tax allowance and you want to avoid having to pay tax on interest from the £60k you could split it £20k into an easy access account, £20k into a cash ISA and £20k into premium bonds (which also assumes you've not contributed to an ISA this tax year nor in danger of exceeding the £50k premium bond maximum). 

Personally I wouldn’t be recommending this.  I know there are pro and anti premium bond posters but I think it’s safe to say if you’re going premium bonds then the best return is to max out.
Not sure if I understand correctly when you might want to access the money but perhaps as above but with the last £20k into a notice or fixed term account ?

The latter creates a restriction on access and also brings potential for tax liability into the equation. OP may want to avoid bringing hmrc into it if not already on SA. Otherwise, yes, as you suggest if restriction also not an issue. 

They would be doing well to earn £10k interest on a £60K capital, so unless you know of an account that gives >16% interest I think it's safe to say no self assessment will be needed for this.

I'd agree with the recommendation not to consider premium bonds - for a short term hold, of less than maximum, the returns are just too variable. Instead, consider a notice or fixed account (with cash that you don't need instant access too) to boost the rate.

Eyeful

1. Any money needed within 5 years should be kept in a Bank or Building Society Savings Account protected up to £85k by the FSCS.
Check that they are on the FSCS list here: https://www.fscs.org.uk/check/check-your-money-is-protected/

2. Consider using a tax shelter such as a Cash ISA.
You can put up to £20k into a Cash ISA each tax year.

3. For best savings rates look here:
https://moneyfactscompare.co.uk/savings-accounts/
https://www.moneysavingexpert.com/savings/

MoneyMan01

There should probably be a mod on this forum that deletes these posts, and sends them a form to fill in all the basic information, to resubmit, so that people can give a relevant response. 

I'm saying that not to be derogatory to the original poster, but these types of posts are always submitted, and you need so much information to even reply, that something like the above would help everyone.

masonic

The most pertinent information was provided in this case, and that is the OP needs to access the money within 9-12 months to buy another home. That narrows the options considerably, to easy access, notice or short term fixed savings products. Investments would not be appropriate. Selection can be from the comparison sites already posted based on the OP's preferences.

Middle_of_the_Road

MoneyMan01 said:

There should probably be a mod on this forum that deletes these posts, and sends them a form to fill in all the basic information, to resubmit, so that people can give a relevant response. 

There will always be people asking questions who don't appreciate that more information might be required to adequately reply to their posts. 

If you follow this logic through, likewise anyone replying might also be required to complete a form that qualifies their ability to respond to said posts.

Implementing the restrictions you're suggesting, would likely discourage anyone posting altogether.