Saving to spend ~ help please

reheat

We want to save money each month toward those inevitable annual costs ... car repairs, holiday, vet bills, house maintenance etc. We've done the MSE budget planning and worked out what we need to put aside each month. So the key criteria I believe are ...

• Able to deposit around £400 a month
• Able to withdraw money instantly.
• No withdrawal limit other than not going overdrwawn.
• Ideally would be able to purchase from it directly. Else able to transfer via web instantly to a related spending account.
• Best interest / lowest running cost.
• The spending account side wants to be joint account

Anyone got suggestions what might be worth looking at please. Many thanks.

climbgirl

reheat wrote: »

Ideally would be able to purchase from it directly. Else able to transfer via web instantly to a related spending account.

I can't think of any high interest savings accounts where you can purchase from them directly - usually only current accounts allow you to do this. And if you want to be able to transfer the money between the savings and current account instantly, you're going to have to have both accounts with the same bank. Otherwise it'll take 3 days to transfer.

I've got a bills account which I save into each month, it's at the same bank as my current account so I can instantly transfer between the two. The interest rate isn't great but the instant transfer was a higher priority. I have my longer term savings accounts with the banks who offer the best rates!

I think you're going to have to prioritise your requirements a bit.

reheat

climbgirl wrote: »

I can't think of any high interest savings accounts where you can purchase from them directly - usually only current accounts allow you to do this. And if you want to be able to transfer the money between the savings and current account instantly, you're going to have to have both accounts with the same bank. Otherwise it'll take 3 days to transfer.

I've got a bills account which I save into each month, it's at the same bank as my current account so I can instantly transfer between the two. The interest rate isn't great but the instant transfer was a higher priority. I have my longer term savings accounts with the banks who offer the best rates!

I think you're going to have to prioritise your requirements a bit.

Makes sense - thanks.

Primrose

I think Egg online saver currently pays 5.5% interest. Most current bank accounts pay virtually zilch in the way of interest rates, so perhaps the best compromise is always to maintain minimum balance of around £1000 in your current account for emergencies, or keep a separate current account with the same bank for emergencies and bills, and once that is there, pay any surplus into the best savings account you can find.

reheat

Primrose wrote: »

I think Egg online saver currently pays 5.5% interest. Most current bank accounts pay virtually zilch in the way of interest rates, so perhaps the best compromise is always to maintain minimum balance of around £1000 in your current account for emergencies, or keep a separate current account with the same bank for emergencies and bills, and once that is there, pay any surplus into the best savings account you can find.

Yes, thankyou. I think Citibank do similar saver accounts, or did anyway. We are currently in the process of digging our way out of an overdraft hole, and the strictly logical thing is to pay off the overdraft first then start saving. Trouble is we also want to get into the mindset of our new year strategy, and the notion of "saving to pay the budget expenses" seems an important part of that mindset. Bit confusing! Concerned that if we don't go into savings mode straight away we might falter. I suppose we should compromise and do a combination of both, factor into the mix a combination of saving to pay as well as reduce the overdraft along the way.

paulboy83

Do your bank do an instant access savings account?, I have a nationwide esavings account for day to day stuff which is linked to my current account there, it pays 5.55% which isnt the best rate but then you dont lose out on interest when you transfer money, as the transfers are instant.

I also have an ICICI account, it pays 6.41% interest and when funds go in they show up the day after they come out of your account, but it does take 3 days for the transfers to happen.

Cazza

Hi! Wondered if you clever people could help me please???

I currently save a set amount each month towards bills which I know are going to happen on an annual basis.

Does anyone know of a savings account which will allow you to separate your savings into "pots"?? ie, one savings account, but I can distribute the money into different sections so I can tell how much I have in the car insurance bit, holidays etc??

An online account would be good, but it doesn't have to be this. Unlimited withdrawals is important too, as the bills are at different times of the year. I'm not bothered about being able to withdraw money instantly, as I think the bills I'll be using the account for I should have enough warning to transfer the money around.

Any suggestions???

Cazza

Bump?!?! Any ideas???

reheat

Cazza wrote: »

Hi! Wondered if you clever people could help me please???

I currently save a set amount each month towards bills which I know are going to happen on an annual basis.

Does anyone know of a savings account which will allow you to separate your savings into "pots"?? ie, one savings account, but I can distribute the money into different sections so I can tell how much I have in the car insurance bit, holidays etc??

An online account would be good, but it doesn't have to be this. Unlimited withdrawals is important too, as the bills are at different times of the year. I'm not bothered about being able to withdraw money instantly, as I think the bills I'll be using the account for I should have enough warning to transfer the money around.

Any suggestions???

Exactly what we wanted, but not found. We are going to try and keep tabs on "virtual pots", using our MSE budgeting to decide how much to each pot each month, and of course what comes out. The totals will be what goes in/out of the account. But it would be a great idea ~ think the banks reckon it would be too much hassle for them.

EmptyPurse

I'd love to find an account like that too but have given up. Instead, I have several instant access building society accounts - one for holidays, one for Christmas, one for Major Purchases etc. I always know more than 3 days in advance that I'm going to spend money from those pots so transferring from the b/s to the current account isn't a problem.As for the comment about clearing the overdraft vs saving a few pennies, I have to say that I disagree with Martin (shock horror!). I spent a couple of years throwing every spare penny at my debts and not saving anything. This meant that I didn't have anything to fall back on when I had financial emergencies or when I was out of work for a couple of weeks. So I just ended up getting further in debt. Now I've changed my priorities and put two thirds of my spare cash towards the debts and one third towards saving for a rainy day. That way I'm clearing my debts and also ensuring that I don't get into debt in the future. Hopefully it'll work!