Help!! Urgent savings needing a home!

Fruitchez

Ok......i've no savings accounts, so it's new to me! But just sold a house and want to place my share somewhere until i decide to buy another place. Wat's best ISA or i was looking at Alliance n Leicester Online banking account,which is looking quite good on interest! Wat should i be looking out for etc.... N should I split the money between two different accounts??

Thanks ever so much in advance!!!:beer:

xx

martinman3

You can put £3000 in an Mini Cash ISA before April 6th if you hurry and £3600 in the same or another from April 6th. Because of the lack of time I would suggest that you open one with whichever organisation is holding you house sale proceeds before you run out of time. From April 6th you can choose an ISA elsewhere if necessary and transfer the first into the second.

As you mention that you will be needing this money to buy another house I am assuming that you have much more than £6600 ! What you do with the rest is much more important.:D

As you say the A&L account, eSaver I believe, at 6.5% is a good start but you should limit the amount in there to £35k as that is the max covered for FSCS compensation. As this has withdrawal penalties, as do some mentioned below, don't be tempted to put it all in there as if you take any out you get no interest on it all for a month !

I would suggest that you divide the money up with £35k or less in each account with a different organisation, some suggestions are below. Then open another account, easy access with no withdrawal penalties at all, with a smaller amount in it and arrange for the interest payable from the others to be paid into that one. This then limits your exposure at any organisation to £35k or less and gives easy access to some of your cash.

Abbey have a e-Saver Direct at 6.25%, Bradford & Bingley Internet Saver at 6.15%, Scarborough BS at 6.05% and many others at 6.0%, check www.moneyfacts.co.uk or www.moneysupermarket.com

There are also accounts from Kaupthing Edge (in Iceland), IceSave (in Iceland), FirstSave (in Nigeria), ICICI (in India) which probably should be avoided for reasons of risk, poor customer service etc.

If you believe that the housing market has a long way to fall you may consider waiting before re-purchasing and putting some in 1yr or more fixed rate savings bonds too.

I am sure that others will give personal experiences of these and other accounts which will help in your decision.