Where to put £130k for the short term?

[Missikat13]

We have recently sold our house and are looking for a new one and have the equity from the sale in the bank, just in a current account at the mo. Where is it best to move this to for the best return? We can't lock it away as will need it as soon as we find and purchase a new place, which I hope would be in the next 3-6 months. We don't have any money in ISAs but would it be worth it for how short term we're looking? Any advice would be welcome.

Hampshire trust online easy access looks pretty decent at 5.15%.

You can only earn interest tax free up to £1000 if you are a basic rate tax payer. £500 if higher rate. So with rates c 3-4 % you need an ISA to protect the interest from tax if its going to be 6 months. Go on Martin Lewis website and find the best instant access ISA account. They won't be as good as normal savings rates but you won't run the risk of tax. You can only do that for £ 20k each.
If one of you doesn't pay tax at all open the account in that name and use a normal savings account.
The rest will have to go in a normal acc

£50,000 each in premium bonds?

£20k each in cash ISAs will shield some of it from tax.

The rest in a limited access savings account.

Don’t leave it all in one bank - the FSCS (or whatever it’s called) applies to deposits up to £85k

Good point re splitting money between banks. But if its a joint account both get £85k so it would be covered.

Premium binds. Ns&I also have a savings account which protects more then the usual £85k

Fair point

Premium bonds? If you split it between you and put 50k in each you should win a reasonable amount each month. The probability checker isn’t working on higher amounts but on 30k it’s saying £1k over a year.

You do have 6 months FSCS cover on temporary high balances such as proceeds of house sale of up to £1m from the date received, so something to bear in mind if it is longer than 6months.

You mean income bonds rather than premium bonds?

My kids have premium bonds and never won a penny.

Premium bonds aren't entered for the draw for the first month so they're not so good for such a short term investment.

Just use an NS&I Savings account.
All your money is protected, you can take it out in a couple of days and you can choose the interest rate (tax paid if that suits).
Beats spreading it around.

When we moved we were already maxed out on PB's so we put all our house money in NS&I Savings. So much easier.

If you trust them gift it No tax if you live 7 years

Premium bonds. We were in the same position so chose these and we were super lucky on our first draw which made it already worth it!