500 deposit

Dandytf · 27 June 2018 at 9:19PM

Considering starting a new savings account or isa.
What can be achieved with 500 deposit.
This will be a savings account in addition to my ongoing H2S account.
Think I could manage another 50 per month.
MSER's care to suggest a starting point.
If an isa coyld be opened, that would ideal as a first ever isa

masonic · 27 June 2018 at 9:23PM

I wouldn't use a savings account or ISA. £500 + £50 per month can be saved in a high interest current account and earn 5% completely tax free if you are a basic rate taxpayer and earn less than £1000 in interest per tax year.

For example, Nationwide Flexdirect. You would need to meet a funding requirement of £1000 per month, that can be achieved by transferring the £500 back and forth a couple of times. Alternatively, use their Flexclusive Regular Saver (also 5%) and there is no need to meet the funding requirement.

Dandytf · 27 June 2018 at 9:35PM

masonic wrote: »

I wouldn't use a savings account or ISA. £500 + £50 per month can be saved in a high interest current account and earn 5% completely tax free if you are a basic rate taxpayer and earn less than £1000 in interest per tax year.

For example, Nationwide Flexdirect. You would need to meet a funding requirement of £1000 per month, that can be achieved by transferring the £500 back and forth a couple of times. Alternatively, use their Flexclusive Regular Saver (also 5%) and there is no need to meet the funding requirement.

Thanks very rapid response tonight appreciated.
I shall call Natwide from Monday as I've only just paid off Felx direct overdraft via Step Change and account was since closed.
I'm not sure If I'll be able to open a new flex account though I can only ask.
Are there any other similar rate savings account to consider.
We're sorry, but we can't offer you the product you've applied for because you're not eligible.-natwide as I suspected

Dandytf · 27 June 2018 at 10:35PM

Since searched 5% rates are all linked accounts which are of no use to myself as I don't want to switch.
Think nest best are 2.25%.
Maybe I'll keep in instant account until something else turns up. Or if I could find a decent isa for maybe 5 years.

masonic · 28 June 2018 at 7:03AM

If you've previously had debt problems, then you might struggle to qualify for any of the other current accounts. As it seems this money is your only savings it would be best not to lock away with no access. Fixed term ISAs would be ok as you'd have access with an interest penalty in an emergency. Lots of options here, but none are particularly exciting.

Dandytf · 28 June 2018 at 7:18AM

masonic wrote: »

If you've previously had debt problems, then you might struggle to qualify for any of the other current accounts. As it seems this money is your only savings it would be best not to lock away with no access. Fixed term ISAs would be ok as you'd have access with an interest penalty in an emergency. Lots of options here, but none are particularly exciting.

2.05% Virgin money -5yrs.
I shall open this next few days
Thanks maybe I should review the mentioned list.
Think it's E-Isa Issue 5 via Virgin-5 Year Fixed Rate Cash E-ISA 2.05 aer

bhjm · 28 June 2018 at 8:22AM

either nationwide current account with 5%(first year) + regular saver 5% for 250£ max per month.

if you plan to buy a house - Lifetime ISA would be an option as well - you can save 4.000 a year and get a bonus from 25% from the government - sadly 0.75% interest only. but outweighs by the bonus in my eyes

YorkshireBoy · 28 June 2018 at 8:27AM

bhjm wrote: »

either nationwide current account with 5%(first year) + regular saver 5% for 250£ max per month.

Probably too soon to re-apply, being as the OP was declined just over 12 hours ago. See post #3

kidmugsy · 28 June 2018 at 11:01AM

bhjm wrote: »

if you plan to buy a house - Lifetime ISA would be an option as well - you can save 4.000 a year and get a bonus from 25% from the government - sadly 0.75% interest only. but outweighs by the bonus in my eyes

The Skipton BS Cash LISA paying 0.75% is about to be joined by a Nottingham BS Cash LISA paying ??% p.a.

Dandytf · 28 June 2018 at 7:25PM

bhjm wrote: »

either nationwide current account with 5%(first year) + regular saver 5% for 250£ max per month.

if you plan to buy a house - Lifetime ISA would be an option as well - you can save 4.000 a year and get a bonus from 25% from the government - sadly 0.75% interest only. but outweighs by the bonus in my eyes

As I'm a home owner I can;'t get h2buy isa unfortunately

Terry_Towelling · 28 June 2018 at 9:20PM

Dandytf wrote: »

2.05% Virgin money -5yrs.
I shall open this next few days
Thanks maybe I should review the mentioned list.
Think it's E-Isa Issue 5 via Virgin-5 Year Fixed Rate Cash E-ISA 2.05 aer

If you put it in a 5 year fix you won't be able to get at it for 5 years or add anything extra to it, so you will just get 2.05% on £500 compounding a little each month.

It might be a better idea (if you like the idea of using a Virgin account) to pick a Virgin regular saver (Issue 11 is on at the moment - issue 12 probably next month). These are easy access and you can add each month up to £250, so it fits with what you want to put in. You'll also get 2.25% on a steadily increasing balance. So put £250 in tomorrow, another £250 on 1st July and then £50 monthly from August onwards for no more than 14 months in total. That may be your best bet if current accounts are out.

After the 14 month period (if you want to run the account for that long) you can start a new Virgin RS account and recycle the old regular saver so that your monthly pay-in can be slightly higher. You can do this for 5 years for a much better return than simply leaving £500 in a 5 year fix.

Also, you don't have to put money in a Virgin RS every month and you can take money out whenever you like - you just can't exceed £250 pay-in in any one month.

500 deposit

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