Left over money- advice needed

[Madamolive]

After all bills/rent/tax/car-petrol,insurance/food/phone bills/money owed £100 till december; at the end of each month i'm left with just over £250. £350-£450 come december.

Advice needed on what i do with this? I have one DC, no.2 on the way. Don't have pension plan, savings. Some months i will have car tax/renewal of tv license/new clothing etc to pay.

Best advice on what to do with this money.

Tax-free isa? You can save up to £5,340 per tax year. Choose an account with decent interest rates but which lets you take out money as you need it. It's nice to see savings building up!

Or, plan b) spend £10 of it each month on lottery/horses and see if you can get a big win .

Or plan c) Premium bonds - combining the safety of knowing you can get yor money back any time with the thrill of knowing that you might get a big pay-out if you are very very lucky...

Agree that an easy-access cash ISA is a good place to put spare cash for the relatively short term as you won't pay tax on any interest. Comparison sites can help you decide which is offering the best return. Thinking longer term, consider taking out Child Trust Funds for your children (or adding to the one started for your older child) with a regular amount each month. These days a 'college fund' is a sensible idea. Alternative you could put part of your spare cash each month into a portable stakeholder pension scheme. Look for ones that don't add large charges. Another good move is to set up a Direct Debit into your chosen savings plan. That way it becomes a saving habit and you get used to managing with what's left after the DD has gone out.

Just a side issue, Child Trust Funds have been stopped now and soon to be replaced with a Child ISA. I understand that they are going to be the same principle though.