Moving money

[Nowtsure]

I have some money in the Natwest 6% regular saver (£1500) and another about (£3000) in Vanguard lifestrategy. Vanguard fluctuates but is currently on about 4%

Is it a better choice to move both funds to the NS&I 6.2 1 year fixed or am I better leaving them where they are?

I feel like the Vanguard is a no brainer and I should move it but not sure about tge Natwest.

Can anyone help with the figures and calculation?

Thanks

I wouldn't say the Vanguard is a no brainer... Stocks and Shares mustn't randomly be "moved" and are designed for the long horizon. "moving" stocks and shares involves selling things which bakes in losses (As well as potential gains). It isn't the same as your other cash savings. I would have thought you'd leave the Vanguard as is well alone for the long term long horizon and not treat it as being at par with your cash savings.

The difference between 6% and 6.2% is negligible - on £1,500 it's a difference of £3.

To do the calculations, multiple the amount of savings by the interest rate (in the form of a percentage):

1500 x 0.06 [6% interest displayed as a percentage] = 90
1500 x 0.062 [6.2% interest displayed as a percentage] = 93

Also take into account any fixed term and whether you're still adding money. Which matures earlier, the NatWest or NS&I? Is the NS&I a bond, so money can't be added to it?

Can't comment on Vanguard Lifestrategy. Is it stocks & shares? As Combusting said, stocks and shares are for the long term, not short-term moving around for the highest return like you would do with cash savings.

Hmm thanks both for the insight @Plexie and @Combusting

The NS&I is the 1 year fixed guarantee bond, so money can't be added to it. It will be a lump sum payment of about £4500/£5000.

The Natwest is a regular saver, so you can only put in £150/month, up to £5000 in total, but this could change at any moment unlike the NS&I.

Yes the Vanguard is stocks and shares and is definitely for the long run. I just felt I may benefit more in the short-term. So withdraw the money and put into the NS&I, then once it's mature, I'll withdraw and invest again in the shares and stocks.
However, sounds like you're both saying it's not worthwhile?

You cannot just "withdraw" a stocks and shares fund. Withdrawing applies to cash. Stocks and shares need to be sold - there will be selling fees, the fees of the transcation/platform, and the losses you may bake in when you sell. I seriously doubt you will recuperate these costs in quest of a fractional saving rate. Investing is not equal to having cash in a liquid account.

As far as the actual cash in Natwest is concerned - is it worth it for £3?

your objectives and post seem a little confused. You are talking about short term gains then long term.

I assume you put the money in your Vanguard with a long term (10+ years) timeframe in mind? You know that values can go up and down with stocks and shares. So what has changed since then?

You could get your guaranteed 6.2% with the growth bond in 12 months, if that's what is more of a priority to you (it's a couple of hundred quid). It isn't a no brainer, in my mind its a no brainer to leave the money invested and actually pay in more if you are able to join a regular basis.

You talk about taking the money from your 6.2% bond in 12 months and then buying back into vanguard, but what if the vanguard fund has increased by 8, 10, 12, 20 or 30% in those 12 months?

You need to be clear, do you want to maximise returns over the next 12 months (if so then do the 6.2% bond) OR want to have your money grow over the long term (then go with the Vanguard).

As above. But also the talk of “moving” stocks and shares as though it’s cash sitting in a savings account concerns me that you possibly don’t fully understand how the Vanguard or any stocks or shares are meant to work…

Thanks all, I've learnt a lot from your responses.

I have thought about this some more and you are right. I hadn't really thought about the transaction fees for Vanguard. I do see it as long term investment but also as an emergency fund, only for when it is absolutely necessary (although I've never taken from it in 3 years). Perhaps this is the problem and I need to change that thinking.

That;s right - big think change needed.

Stocks and Shares are NOT a rainy day emergency one. You need something liquid for that i.e. easy access, no restrictions cash savings.

Stocks and Shares are not sitting as cash to be "taken" and "moved". They are stocks and they are shares which need buying and selling, and involve transaction and platform fees. They need to be left alone for 10 years or more.
They are not "available" to you when you wish.

Generally your holdings would fall into 4 categories -

1. Highly liquid, easy-access cash sinking pots: for e.g. yearly expenses being saved for monthly so will get used up over a year (holidays, car service, etc).
2. Highly liquid, easy-access, cash savings accounts: Emergencies, rainy days, and other savings should you wish.
3. Not very liquid, cash savings (Fixed Term bonds, fixed savers - so, still cash, but liquid and instantly available): Here you might have some mid and long term savings,
4. Not liquid, not easy access, investments (Long horizon, not cash, stocks and shares): For the long long horizon. Not accessible for rainy days and such.

Yeah I am stuck with blinking S &S ISA which is even worse than Vanguard And the thought of charges for selling fill me with dread (I mean I am with Santander total shit ) so you are ok

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