Best place for teenage son's £500??

bunnygirl007

Hi, can anyone advise me please?

My son who is 17 currently has about £875 in a Halifax Instant Seaver. It used to be a 'Save 4 It' account which attracted an interest rate of around 6%. However it seems since he turned 17 his account was transferred to an Instant Saver with a poxy interest rate - and they didn't even bother telling us we just found out by chance one day when he went to draw some money out using his cash book. Seems to be a common habit with Halifax - they changed my current account to a Cash Card account (fortunately its not my main current account) without telling me but that's another story!

Anyway I think my son should transfer £500 of his savings into an account that will give him a good interest and help him to continue to build his nest egg and keep the rest where it is, transferring lumps sums each time he has more than £500 saved in it. What bank or building society or other saving scheme would you recommend for him to deposit his £500 into?

He is still at school and gets EMA of £10 a week, he is looking for a part time job but hasn't got anything yet.

Steve_xx

He should use his ISA allowance. The new Alliance & Leicester IDA pays 6.25% and of course he gets to keep all of the interest as no tax is taken of it. He can put £3000 into it before April 5th, then another £3600 into it after April 5th, ie new tax year.

http://www.alliance-leicester.co.uk/savings/index.asp?page=direct-isa