£60k needing a home for a year!

ronofcam

Hi guys,

As the title says, I've sold my house and am renting for a year. I don't want to buy for a year as I want to see what the market's gonna do in terms of how much it's going to decrease.

So.... I've got a few bob to stick away for a year. The question is though, where/what do I do with it? I'm a complete doofus when it comes to things like this, and don't even know if I'll get taxed on it if I stick it in a high intereste account for a year.

I know the West Bromwich does a 6.55% AER (12 withdrawals permitted annually), and I don't mean to touch it for at least a year.

Does this sound like a plan, or am I missing something obvious, which - frankly - is not unheard of!

Thanks in advance for all your advice!

Ron

planemad

I'm not going to advise you on what products are out there for your money but don't put all 60k with the same organisation.
If the organisation goes bust you are covered 100% for the first 35k, so having your 65k spread between a 2 providers with 30k in each would be a good choice.

Check out the tables on this site to see where your monies are best suited to your needs but for a fixed rate bond you are looking at achieving 6.5% to 7.0%.

[Deleted User]

ronofcam wrote: »

Hi guys,

As the title says, I've sold my house and am renting for a year. I don't want to buy for a year as I want to see what the market's gonna do in terms of how much it's going to decrease.

So.... I've got a few bob to stick away for a year. The question is though, where/what do I do with it? I'm a complete doofus when it comes to things like this, and don't even know if I'll get taxed on it if I stick it in a high intereste account for a year.

I know the West Bromwich does a 6.55% AER (12 withdrawals permitted annually), and I don't mean to touch it for at least a year.

Does this sound like a plan, or am I missing something obvious, which - frankly - is not unheard of!

Thanks in advance for all your advice!

Ron

A quick reply to your question as I'm in a rush...

I would stick £3k in a cash isa for this tax year (if you haven't already) ... then hang onto £3600 (next years new limit) and stick it in the cash isa after 6th April (next tax years allowance) Then I would split the remaining balance between 2 good paying fixed rate savings bonds for a year. You would then be fully covered by the £35k compensation limit in each a/c.

:money:

amcluesent

Ingot gold is the only really safe store of value now.

Aegis

amcluesent wrote: »

Ingot gold is the only really safe store of value now.

Gold value can go down as well as up. It's certainly not safer than cash!

[Deleted User]

ronofcam wrote: »

Hi guys,

As the title says, I've sold my house and am renting for a year. I don't want to buy for a year as I want to see what the market's gonna do in terms of how much it's going to decrease.

So.... I've got a few bob to stick away for a year. The question is though, where/what do I do with it? I'm a complete doofus when it comes to things like this, and don't even know if I'll get taxed on it if I stick it in a high intereste account for a year.

I know the West Bromwich does a 6.55% AER (12 withdrawals permitted annually), and I don't mean to touch it for at least a year.

Does this sound like a plan, or am I missing something obvious, which - frankly - is not unheard of!

Thanks in advance for all your advice!

Ron

Forgot to mention that cash isa's are TAX FREE! and savings accounts/fixed rate bonds etc., are taxed at 20% automatically; in other words subtract 20% from the stated AER and that's what you actually receive as interest.

This current tax year (upto april 5th) you can put £3000 in a cash isa, and from april 6th (next tax year) the limit is being increased to £3600 for cash isa's.

Hope this helps.

Goldfinger:money:

notis7

My thoughts are to put at least half in a fixed product so you cant touch for a lengthy period - put your money with a high street bank, put the rest in an ISA £3k +£3.6K (March and April) and the rest in a high interest instant access account with a few free withdrawals ( max of 6)

For the fixed rate you dont need to go for a year. I will give you an example
The Halifax offer a 6 month fixed web saver
http://www.halifax.co.uk/savings/fixedwebsaver.asp
but there are others out there who offer 3 month, 6 month and 9 month fixed!

My feelings are though that as the liquidity crisis is going to see some small players tumble this year - stick with the bigger players!

jamesd

About 4,000 of interest on that for the year. If you're interested in taking some risk you could consider using a fund like the Blackrock Merril Lynch UK Absolute Alpha fund. It managed to return 9% over the last year without its value jumping all over the place but there is still no guarantee that it will not go down in value. A one year term is quite short for this sort of thing, even in what appears to be a fairly safe fund with deliberately cautious objective. If you're unwilling to take the risk of a drop you should not consider this.