Where to save £300k safely?

jimbo076

Hi,
We are about to sell our house, not buying again so have all the profit to put away.
Our ISA allowance is fully taken up and we have a number of savings accounts with Kaupthing Edge, ICICI, Icesave, etc. but if you try to stay within the £35k max then you very quickly run out of decent return rates.
Could anyone suggest other options? We thought about Premium Bonds but are not that convinced and it still leaves us with a lot of money left to invest.

Thanks a lot for viewing this thread.

whu

you might want to have a word with an IFA with that sum but as for savings etc you could consider national savings and investment index linked certificates which are tax free and currently pay out 0.7% above RPI over either a 3 or 5 year fixed period - particularily useful if you are a higher rate tax payer

[Deleted User]

I agree with Whu. Take a look at http://www.moneysavingexpert.com/savings/safe-savings#safe and the heading "Do any banks offer 100% safety?" for a discussion of NS&I and Northern Rock and http://www.moneysavingexpert.com/savings/premium-bonds for a discussion of Premium Bonds (and how rubbish they are...)

jimbo076

Thanks for these, I'm very grateful for this advice and will look into NS&I straight away

exel1966

With £300K i'd seriously consider buying £30K of PB's. Ok your return will possibly only be 3-4 % but you don't go into PB's expecting a guaranteed 6-7 %, you do it with a small risk/potential small loss and with the attitude of having a small flutter and possibly winning a larger prize. Now if I only had £30k I wouldn't consider it, but as you seem to have other funds wrapped up in good accounts and a sizeable sum I'd do it.
Just ask the the tens of thousands of people who've won the larger prizes whether they thought it was worth it. Nothing in life is certain though, just as winning on the PB's isn't.

dwsjarcmcd

There are a couple of good 2 year bonds, all paying around 7%, where I think I'd put some money. These are West Bromwich B.S, Yorkshire B.S and of course Bradford & Bingley

ed123_2

..Kaupthing Edge 7%, Icesave 7.01%, Firstsave 7.1%, ICICI 7%, Brad & Bing 7%, West Brom BS 7.05%, Abbey 7%, Yorkshire BS 7%, Hertiable Bank 6.85%.....£33k in each.....(to allow for interest)

PauliPauli

stick it all into northern Rock?

[Deleted User]

exel1966 wrote: »

With £300K i'd seriously consider buying £30K of PB's. Ok your return will possibly only be 3-4 % but you don't go into PB's expecting a guaranteed 6-7 %, you do it with a small risk/potential small loss and with the attitude of having a small flutter and possibly winning a larger prize. Now if I only had £30k I wouldn't consider it, but as you seem to have other funds wrapped up in good accounts and a sizeable sum I'd do it.
Just ask the the tens of thousands of people who've won the larger prizes whether they thought it was worth it. Nothing in life is certain though, just as winning on the PB's isn't.

In theory I agree. In practice I don't...

Let's say you invest £30,000 in Premium Bonds for 10 years and then let's compare this with the current top savings account for a basic rate taxpayer...

Put the money in a top savings account paying 6.5% and you’d earn £15,600.00. If you put the same amount in Premium Bonds there is an 98.3 % chance you will earn less than this

:eek: :eek: :eek:

Thank you calculator: http://www.moneysavingexpert.com/savings/premium-bonds-calculator/index.php

exel1966

I can't dispute the figures, BUT you will still earn around £10k as an average with PB,s, therefore leaving only a small potential loss, BUT with the chance of far exceeding any amount payable in interest from a savings account.
If you don't mind a very small gamble, i'd definately say it was worth it.

[Deleted User]

exel1966 wrote: »

I can't dispute the figures, BUT you will still earn around £10k as an average with PB,s, therefore leaving only a small potential loss, BUT with the chance of far exceeding any amount payable in interest from a savings account.
If you don't mind a very small gamble, i'd definately say it was worth it.

I suppose. Interestingly the table then goes on to say:

At least £25,000 1 in 165
At least £50,000 1 in 362
At least £100,000 1 in 1,008
At least £1,000,000 1 in 5,079

Not rubbish odds by any stretch of the imagination.