Best place to park 6‑figure remortgage funds for <1 year while waiting on planning?

isotonic_uk

Hi all,

I’ve just completed a re-mortgage on a 5‑year fix, which includes an extra 6‑figure amount to fund an extension. We’re still going through planning, so the building work won’t start for a while. We hope in the next 3 months we will be near the end and can appoint a builder. 

In hindsight I wish I had just gone with a tracker or even an offset based on recent changes so we didn't tie ourselves up but too late to change now. Timing was slightly against us unfortunately. I did post about a late change here but having spoke to new lender have decided to stick with the original option we decided upon: 

Fixed vs Tracker – Need Advice Before Completion (Halifax) — MoneySavingExpert Forum

We don’t want this money sitting in our existing current account losing value, so looking for the safest short‑term home for it.

Key points:

• Time horizon: likely under 1 year
• Access: ideally easy access, but comfortable with up to 90‑day notice
• Already maxed out both mine and my partner’s Cash ISA and S&S ISA allowances for this tax year
• I’ve looked at the MSE savings tables and am considering Chase or Co‑op/Cohoot as potential options
• I also have existing investment funds, but I’m aware these can go down and don’t feel right for money needed for building works

Question:
For money that needs to stay safe, liquid, and available within a year, what would you do? Stick with a top easy‑access account, go for a notice account, or consider something else entirely? 

Interested to hear how others have handled similar situations. If it helps we would be keen to monitor the account weekly to ensure it's still fit for purpose rather than moving and not worrying about it.

Many Thanks!

El_Torro

I would find the highest interest cash savings and go with that, no need to overthink it. You've already mentioned Chase at 4.5% for a year, sounds as good a place to put the money as any. 

Will you be paying tax on your interest? If you will be paying 40% tax then Premium Bonds are worth considering. 

You haven't mentioned the amount of money but make sure you get the full FSCS protection. No point putting your money in a safe place and then not having all of it protected. 

isotonic_uk

El_Torro said:

I would find the highest interest cash savings and go with that, no need to overthink it. You've already mentioned Chase at 4.5% for a year, sounds as good a place to put the money as any. 

Will you be paying tax on your interest? If you will be paying 40% tax then Premium Bonds are worth considering. 

You haven't mentioned the amount of money but make sure you get the full FSCS protection. No point putting your money in a safe place and then not having all of it protected. 

Thanks, yeh I was thinking along the same lines however I am unfamiliar with premium bonds. I am a 40% tax payer, although my wife is on the lower rate. Does that make any difference?

I would make sure it has FSCS protection of £120k. 

My only issue with the variable is it could change which means then looking for another option. I been looking into Propser with Santander International which offer a 3 month fixed option Prosper Products | 3 Month Fixed Term Deposit

El_Torro

isotonic_uk said:

El_Torro said:

I would find the highest interest cash savings and go with that, no need to overthink it. You've already mentioned Chase at 4.5% for a year, sounds as good a place to put the money as any. 

Will you be paying tax on your interest? If you will be paying 40% tax then Premium Bonds are worth considering. 

You haven't mentioned the amount of money but make sure you get the full FSCS protection. No point putting your money in a safe place and then not having all of it protected. 

Thanks, yeh I was thinking along the same lines however I am unfamiliar with premium bonds. I am a 40% tax payer, although my wife is on the lower rate. Does that make any difference?

Opinions vary on at what point Premium Bonds are worth it. My personal view is that if I was paying 20% tax on interest I wouldn't bother with Premium Bonds, you're likely to get better net results elsewhere. So I would only consider Premium Bonds on money that is in your name. 

Albermarle

Premium bonds ( max you can have is £50K ) are like a giant lottery draw. The difference is that you still get your money back in the end.
Each month you usually win a prize or prizes. Typically £25/£50/£100 but very occasionally can be more ( there are two Million Pound prizes each month). Statistically you should get around the average, which I think currently is around 3.3%. All prizes are tax free.

isotonic_uk

Albermarle said:

Premium bonds ( max you can have is £50K ) are like a giant lottery draw. The difference is that you still get your money back in the end.
Each month you usually win a prize or prizes. Typically £25/£50/£100 but very occasionally can be more ( there are two Million Pound prizes each month). Statistically you should get around the average, which I think currently is around 3.3%. All prizes are tax free.

ok thank you for that info, £50k won't be ideal as I need to put at least double. 

Emmia

isotonic_uk said:

Albermarle said:

Premium bonds ( max you can have is £50K ) are like a giant lottery draw. The difference is that you still get your money back in the end.
Each month you usually win a prize or prizes. Typically £25/£50/£100 but very occasionally can be more ( there are two Million Pound prizes each month). Statistically you should get around the average, which I think currently is around 3.3%. All prizes are tax free.

ok thank you for that info, £50k won't be ideal as I need to put at least double. 

You could split the money, part in Premium Bonds and part in a savings account.

eskbanker

isotonic_uk said:

Albermarle said:

Premium bonds ( max you can have is £50K ) are like a giant lottery draw. The difference is that you still get your money back in the end.
Each month you usually win a prize or prizes. Typically £25/£50/£100 but very occasionally can be more ( there are two Million Pound prizes each month). Statistically you should get around the average, which I think currently is around 3.3%. All prizes are tax free.

ok thank you for that info, £50k won't be ideal as I need to put at least double. 

As with your ISAs, the limit is per person, so as a couple you could hold £100K if you chose to do so.