Where to put savings

[Paddingtonthebear]

I’ve been saving money each month for a while and have about £9k at the moment. Currently it’s in a Marcus account but the rate has dropped to next to nothing. I would like the option to access it fairly quickly if needed. Where should I put it? Premium bonds?

Premium Bonds slashed their rate about two weeks ago, we are sitting on our savings until our IFA meeting at the end of the month.

Ah, ok!

Do you need access to all of it at short notice? If some of it is more of a long term saving, then it could go into a stocks and shares ISA.

I would prefer access to it fairly quickly

I am in the exact same position as you, OP, precisely this amount in a Marcus account. Unfortunately, if you want instant access, there don’t seem to be any obviously better options.

I'd go with premium bonds, there's a chance you could win big! I'll be shifting my savings over in December when the rate drops on my current savings account.

I e also got money in premium bonds but it’s only vaguely sensible if it’s very short term so investing doesn’t make sense.

It sounds like your emergency fund so you don't have much choice but to leave it in a bank account where it can be accessed easily. Money that you might need at short notice shouldn't be invested as you have the potential for it to be significantly reduced in value due to market fluctuations, as well as losing the benefits of compounding when you draw down some of the balance.

Well it’s actually the start of saving for a house deposit, but having already been furloughed once this year I’m thinking it may be wise to have access to it if needed rather than locking it away

Yes, it’s sensible to have an easily accessible rainy day fund.

However, if you’re saving for a deposit, then a LISA would be a much better place as the government will top up your savings by 25%.

Got exactly the same problem OP. I've split my savings. Half in Marcus making nothing. Half in a nutmeg stocks and shares ISA. The ISA isn't quite instant access but it's accessible if I need it and it's a lot better for returns than anything else right now. It's tough for savers right now.

If you're still saving, premium bonds might be as good a choice as any as the more you have, the more likely your winnings will match the 1% prize rate and all instant access accounts are now less than this(?).

Think of it as gambling the very small amount of interest you'd definitely get elsewhere - on your £9k, you'd get £90 a year if you had 1% savings, so you'd have to get 3 or 4 £25 prizes each year to be in the same ballpark, but in reality you might only get 1 or 2 prizes, so would lose out a little, and of course, you could win absolutely nothing but this is probably quite unlikely, as is winning significantly more than £100 in a year, but you never know - I'm currently doing really well in PBs, in 2019 I won 4 prizes, which equated to a rate of around 2% and this year I had a bigger win of £1000 and a couple of £25 prizes, so around 6% return, assuming I don't win anything else for the rest of the year, but of course, that's unusual - 98% of prizes are at the £25 level.

You could move to a LISA but I don't think you can access the money without penalty unless for a house deposit or pension(?)

Too old for a LISA

Echoing what others have said with premium bonds being your best bet as you'll get pitiful interest in quick access savings accounts right now. Easy to set up on NS&I website and instant access when needed. There's also the thrill every month waiting to find out if you've won a prize!

Get a financial advisor it’s worth it - you can access rates not on the high street and a stock based isa - good luck

Def premium bonds