Pay off mortgage in 18 months

[Meadowgreen]

Due to an unexpected windfall, we can clear our remaining mortgage in 18 months (when fixed term ends). What should I do with the money in the meantime so I a) don’t spend it b) earn the most interest on it?

Premium bonds (for up to £50k)? Not a guaranteed return but good fun every month to find out what you've won.
And then stick the rest in a savings account or ISA (or several different ones depending on how much money you have to invest).

Premium bonds

It’s 200k, so perhaps it might be worth splitting across accounts?

See financial advisor to invest it and get interest from it

I’d put it in various fixed savings accounts. Only £85,000 is guaranteed by the government so split the amount across three different banks / building societies to be safe. If you go to the savings section on moneysavingexpert it gives you the top accounts, and you can choose to fix for 6 months or a year etc.

Worth bearing in mind you’ll have to pay tax on the income but you’ll still get a nice return.

For 18 months I’d put 20k each in a cash isa with as decent rate as you can. Then basically just look up the best fixed rate bonds. Usually you can have £85k each per financial institution protected so maybe £80k each in your name and DH name.

1 year fixed rate bond paying say 4% (just an example, but looks like those kind of rates are available) on 80k each would give over 7k in interest. Don’t forget you’d have to pay tax on that so that might sway who’s name you put it in.

Premium bonds is a good idea too, you can have up to 50k each and the prizes are tax free

No point investing any money for 18 months