messy savings!

Prudent

I am a bit of a compulsive saver. Despite being a single parent on a moderate income I manage (with big thanks due to this site!) to save a fair bit of my income.

My current savings have been build up over the last three years, when I put all my previous savings into buying the house I now live in. The money in the yorkshire bs account remains from the time prioir to buying the house. My aim is to build up to savings of around 40 -45k and then relax a little . Don't ask me why that figure. I guess I feel it is enough to live on for a few years if I need to for any reason.

This is where I have my savings, and would appreciate your comments. I know there are probably a lot better ways of organising this money and that I am not doing too well at it. (The reasons for the money in TSB saver v cahoot is the transfer time. The money can be instantly transferred if I need it in an emergency)

Surplus in high interest current account (5%) £1,000
Premium bonds £5,500
Cash ISA (Nationwide) £9,621
Cahoot savings (5.30%) £13,886
ING direct (5.0%) £2060
Yorkshire building society (3.2%) £170
Friendly society (approx) £1600
Lloyds TSB (5%) £3500

Total: £ 37,337


I have had the friendly society scheme for 7 years. I invested before I learnt what I know now! This is a 10 year plan due to mature just before my daughter's 18th Birthday. I set it up when my circumstances were harder than now. I wanted to have some money put aside to be able to give her if she wanted to go to uni. I know in that sense it doesn't seem a lot but at the time I pushed myself to find the money.

Careful_ly

Hi Prudent

Im no expert but like to make my money earn as much as possible.
Some of your rates look a little high. Have you review since rate cuts. eg Ing is 4.75%

Is your Isa with nationwide 4.6% instant or 4.9% members 60 notice?

You could think about a regular saver account

eg 8% fixed from Cheshire building society - 1 year account no withdrawals
max £500 per month minimum £25

7%fixed Halifax 1 year again £250 per month maximum

Derbyshire have a regular saver only £10 per month minimum and you can put in £1000 maximum in any month, this pays 5.4% you can make one withdrawal each financial year without losing the 5.4% rate


Coventry have a 7.25% for 1st year rate account if you pay in your child benefit

Hope this helps

Careful_ly

YorkshireBoy

Prudent wrote:

The money in the yorkshire bs account remains from the time prioir to buying the house....Yorkshire building society 3.2% £170...

If you've had this account for several years, ie since before they started asking new applicants to sign away demutualisation benefits, I'd definately keep this account open with it's current balance just in case

I'd probably consolidate a few of your accounts into one or two high interest internet based accounts. I'd also keep the old accounts open (with a couple of quid in each) just in case, as rates change all the time.

Other than that, it's just a case of maximising the ISA's every year, and considering regular savings as has been suggested already. Have you read the "savings fountain" article on the main site, or the thread of the same titile on this board?

Prudent

Careful_ly wrote:

Hi Prudent

Im no expert but like to make my money earn as much as possible.
Some of your rates look a little high. Have you review since rate cuts. eg Ing is 4.75%

Is your Isa with nationwide 4.6% instant or 4.9% members 60 notice?

You could think about a regular saver account

eg 8% fixed from Cheshire building society - 1 year account no withdrawals
max £500 per month minimum £25

7%fixed Halifax 1 year again £250 per month maximum

Derbyshire have a regular saver only £10 per month minimum and you can put in £1000 maximum in any month, this pays 5.4% you can make one withdrawal each financial year without losing the 5.4% rate


Coventry have a 7.25% for 1st year rate account if you pay in your child benefit

Hope this helps

Careful_ly

Many thanks for all the suggestions. You are right about the ING rate, sorry. ISA at 4.6

Looking at you post I think the Cheshire building society might be a good idea.I could manage the £500 per month and the rate of interest seems good, But I guess I will have to move it at the end of the year?

lipidicman

Prudent wrote:

I am a bit of a compulsive saver. Despite being a single parent on a moderate income I manage (with big thanks due to this site!) to save a fair bit of my income.

My current savings have been build up over the last three years, when I put all my previous savings into buying the house I now live in.....My aim is to build up to savings of around 40 -45k and then relax a little ...I guess I feel it is enough to live on for a few years if I need to for any reason.

Just wanted to say 'good on ya'. Its a nice feeling to be financially secure isn't it?

One small question, could some of the money work harder by reducing your mortgage (assuming you have one)?

Hobo_2

With the Cheshire R/S after 12 mths the money 6K + interest sweeps out, but they notify you of the rate on the regular saver going fwd so you can make a 13th payment & carry on for another 12mths if you so desire.
Same with the halifax R/S

Careful_ly

If you changed the Nationwide to the members 60 day notice ISA (Im guessing you're a 3 years member by the amount in the account) You could earn an extra £95 in total over the next 3 years. They dont have the highest rate but are usually close to the top without the need to keep swapping around for the best rate at regular intervals.
I would agree that it would be a good idea to use your ISA allowance yearly and to review what your mortgage rate is(if you have one) as very likely that you can not earn more interest (especially after tax )than you are paying.

Prudent

lipidicman wrote:

Just wanted to say 'good on ya'. Its a nice feeling to be financially secure isn't it?

One small question, could some of the money work harder by reducing your mortgage (assuming you have one)?

I only have a very small mortgage. I took on a 28k mortgage when I bought this house, as I was awaiting money to come from a marital separation. I took a flexible mortgage and at first I overpaid instead of saving. I mananged to pay back so much that when I got settlement I could have redeemed the mortgage in full (which I hadn't anticipated as settlement wasn't sufficient). However there were redemption charges to repay in full. I could find nothing in the terms about how much it could be reduced by though. So I took and chance and reduced it to £100 and they said nothing. Now I pay £1 per month. I am sure it costs them more to administer the mortgage than they make from me.

Prudent

Careful_ly wrote:

If you changed the Nationwide to the members 60 day notice ISA (Im guessing you're a 3 years member by the amount in the account) You could earn an extra £95 in total over the next 3 years. They dont have the highest rate but are usually close to the top without the need to keep swapping around for the best rate at regular intervals.
I would agree that it would be a good idea to use your ISA allowance yearly and to review what your mortgage rate is(if you have one) as very likely that you can not earn more interest (especially after tax )than you are paying.

£95 would be well worth it, thank you. I have had the account since cash ISAs first came out. I withdrew almost everything in the account when I bought the house. I had to move for my own safety so used all that I had. I bought a house in a really bad state, but in a good area. I did it up, doing everything I could myself, and learnt to do lots of new things! This has actually paid better than the loss to the ISA as its value has now doubled.