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To ask where you would save £7000?

(23 Posts)
gembran Sun 09-Oct-16 20:45:57

Have taken an interest-free loan (long story) and would appreciate advice re. where to save it!

gembran Sun 09-Oct-16 20:46:09

Currently thinking premium bondsx

Evilstepmum01 Sun 09-Oct-16 20:48:29

You save your loan?? Am I missing something? Unless the interest rate is considerably more than the APR on the loan, why?

I save my money, I dont borrow to save hmm

Evilstepmum01 Sun 09-Oct-16 20:49:54

Doh! Just read OP PROPERLY!! its an interest-free loan!!

Right, ISA?

ChablisTyrant Sun 09-Oct-16 20:50:56

We put ours in premium bonds ATM. Rubbish rates everywhere.

rewardformissingmojo Sun 09-Oct-16 20:52:10

Stocks and shares ISA? How long is the loan for, when will you need it?

19lottie82 Sun 09-Oct-16 20:54:01

You're not going to get a great rate on £7k....... Maybe 1% in an ISA? Or your own bank might offer a higher promotional rate if you meet specific conditions?

grumpysquash3 Sun 09-Oct-16 20:54:04

Santander 123 current account pays 1.5% which is better than a lot of savings accounts.
But why are you doing it? Surely you will have to start paying back the loan, even if it is interest free???

IAmAPaleontologist Sun 09-Oct-16 20:54:10

Fixed term savings accounts often good. What is the term of the loan? Stocks and shares not likely to give a good return in the short term. Do you need it to be accessible quickly or not?

gembran Sun 09-Oct-16 20:56:33

It's a salary based loan, so instalments will be taken out of my salary over 2 years. I was thinking an ISA but have already invested the max this year into one.

Am now thinking £5k into premium bonds (as these are fairly accessible) and £2k an instantly accessible savings account with my bank.

gembran Sun 09-Oct-16 20:56:46

Thanks for the advice!

BarbaraofSeville Sun 09-Oct-16 21:06:33

Look on moneysavingexpert for interest paying current accounts.

You can get 5% on up to £2K with TSB and 4% on up to £5K with Lloyds but you will need to move a couple of direct debits to Lloyds and set up a standing order to meet funding requirements - just move money in and out of your current account or other savings.

greathat Sun 09-Oct-16 21:22:51

I was about to say there is details of doing this on the moneysavingexpert site. . Regular saver are good interest rates I think, but you can only save so much per month. Just make sure you pay it all back before 0% interest thing runs out

Gwenhwyfar Sun 09-Oct-16 21:25:19

Barbara - I don't know if it's still the case, but Nationwide had a current account that paid 4-5% on anything up to 2.5k. You'd still need to save the rest elsewhere though and I have no idea whether any savings accounts are giving good interest at the moment.

FleurThomas Sun 09-Oct-16 22:06:19

Open a couple of regular saver accounts that offer 5-6% on up to £250 a month. If you can handle the risk then FTSE 100 based funds are a great buy now with a falling £. Go to Hargreaves Lansdown and check out their top 150 funds.

thatsn0tmyname Sun 09-Oct-16 22:10:21

We have premium bonds and get the odd win of £25. We took most of it and overpaid the mortgage.

Ncbecauseitshard Sun 09-Oct-16 22:20:51

Checkout the cash back sites as some accounts will give money on opening.

BackforGood Sun 09-Oct-16 22:44:32

Trouble is with anything paying over 1% is that there are so many hoops to jump through it becomes hard work, or you have to lock it away (fixed term bond).
tbh, you might be as well to put it into premium bonds with the interest rates being as rubbish as they are.

edwinbear Sun 09-Oct-16 23:17:18

NS&I Direct Saver. Online, instant access paying 0.8% and government backed so 100% secured.

MrsderPunkt Mon 10-Oct-16 00:46:01

For safe and easy access, HSBC were doing a cash isa with a 'reasonable' rate (but only when compared with similar) but interest rates are so rubbish, I'd probably put the whole lot in premium bonds, then once it's safely paid off, try a long term investment (I'm assuming the money will be long term savings?)

annandale Mon 10-Oct-16 00:48:30

The building society interest on the account I'm saving into every month for my son has dropped to 0.8% so I'm going to take most of it out and buy five year national savings bonds at 2.5% interest. It's a gamble that he won't need the money before then, also i can't remember if they're for children only.

reallybadidea Mon 10-Oct-16 01:02:21

If you're happy to tie it up for a long time then why not put it in your pension? You will get tax relief at least 20% so will get a 20% 'bonus' on that amount immediately which is a pretty good deal plus whatever your investment gains in value. If you're a higher rate tax payer you can claim an additional 20% back in your tax return.

BarbaraofSeville Mon 10-Oct-16 06:09:35

Trouble is with anything paying over 1% is that there are so many hoops to jump through it becomes hard work, or you have to lock it away

confused. All the interest paying current accounts can be easily opened online in about a minute.

Tesco current account pays 3% on up to £3k with no pay in, lock in or Direct Debit requirements.

There are a couple of other accounts where the only requirement is to pay a certain amount in each month. This can be done by setting up a couple of reciprocal standing orders, again which takes minutes online.

You can also open a Tesco savings account that can be paid in by Direct Debit, which can be used to satisfy the DD requirements. Several other DDs (eg TV licence) can be changed online in seconds.

The above is explained in detail on MSE and a few minutes work can increase the amount of interest earned by hundreds of pounds a year, so well worth it and not hard work at all.

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