Saving for house deposit, best way to do it

strongboes

Hello all, my first post on the board!

I am a discharged bankrupt and have just opened my first account since being discharged in june 2007. It is a natwest step.

I am under no restrictions with regards to my bankruptcy.

I am able to save a minimum of £1500 per month but the figure I have in mind is 2k.

So the question is considering my status where should I put this money for maximum return.

I will be opening an icesave isa shortly so in may 08 will have £7600 in an isa which is this and next years allowance used up.

I am not adverse to investing in a stock isa but i personally believe we are way off of a bottom in the markets so at this time for me is not appropriate.

Alternative suggestions welcome! Discuss!!

Regards
Ryan

kingmonkey

Max out cash isas each year and then save in the highest paying saving account.

With saving £2,000 a month then you will save a decent deposit very quickly and the interest rate wont make that much of a difference.

I wouldn't be looking at investments.

notis7

Indeed ISA's are the first place to look at - maximise those. Fixed rate savings are still quite high and you should look to benefit from these as quickly as possible....

jamesd

strongboes, stocks and shares ISAs can hold low risk investments, not only higher risk. You might consider a mixture of the Blackrock Merrill Lynch UK Absolute Alpha fund and a corporate and/or government bond fund, for example. Since the Blackrock fund does not pay interest or distributions but instead gets capital growth it's a useful way outside an ISA of using the capital gains tax allowance to avoid tax on savings.

If you're truly pessimistic you could consider something like a gold and general fund that may well go up if the market conditions go down.

For the pessimists there's also the option of short ETFs that go up in value as the index they are tracking goes down, same as selling a share short. But this is a high risk choice.