Where to put lump sum

[loveawineloveacrisp]

I'm about to get a payment of just under £25k which I need to deposit somewhere to earn as much interest as possible. ISA is already maxed out. Needs to be easy access as I need to draw a 'salary'from it over the next 12 months so the balance would obviously be reducing. Any advice please?

Might not be right for you since it depends on your tax bracket but we have just put ours into premium bonds. Tax free like an isa. No guarantee of any increase in value of course (although you could win big). Money is accessible if it’s planned withdrawal as yours would be.

If you’re not losing 40% of your savings interest in tax though there are better options for steady growth

So there's a personal savings allowance for interest I believe? Does this include interest earned in an ISA? I have tipped into higher tax bracket this year but I won't be earning anything else until the new tax year.

ISA is exempt and doesn’t count towards the savings allowance. Premium bonds are too.

I’d look on money saving expert for the highest interest easy access savings account.

you could put £5K into premium bonds until April so you’re not having to pay tax on your interest, (or work out whatever you need to put elsewhere so you’re not over the threshold, threshold depends on a few things). Then April move some of it to Srocks and Shares ISA if you won’t need all of it for 5-10 years or just a cash ISA.

If you won’t pay interest on your savings then there are better options than premium bonds.

If you’re a higher rate tax payer your savings allowance is only £500. But doubtful you’d make that between now and April anyway.

Yeah I just did further reading on HMRC site and came to that conclusion. Thankyou! Hmmm, some research needed today I think.

What would you recommend?

We used an online savings account called Tandum that has a high interest. Cash will be in there until we max out the interest threshold for the year then back into the ISA.

I really think if you are drawing down all of it over the next 12 months to fund your living costs just put it in the best rate instant access account or premium bonds.

Just take a look at the 'best savings' accounts online. You can usually find them on comparison sites. Marcus is great. I have 2 savings accounts with them which earn 4.3% and I draw down on regularly.

moneyfactscompare.co.uk/savings-accounts/easy-access-savings-accounts/?quick-links-first=false&product-favorites-first=false&sort-order=AER&sort-order-text=Rate

Thanks, agree instant access accounts seem like the best option. Not keen on premium bonds, there are no guarantees on any kind of return.

I would just look on MSE for the best easy access rate.

I quite like Atom's instant reward, higher interest paid in the months you don't make a withdrawal but full easy access. Easy to set up in the app. Easy to withdraw when you want too.

Still a top rate with MSE https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/

Was looking at that but would need to withdraw once a month so no good for me really.

@loveawineloveacrisp sorry didn't read properly that you plan to draw a salary from it! I think you are left with a traditional easy access account and the MSE link above gives you a few options with a decent rate with full easy access.

Easy access account plus maybe have a regular saver account, they tend to have the best interest rates but are smaller regular amounts. Just do a standing order. But you need to do the maths if you go down what I call the money go round way. I used to have various transfers going on to maximise interest.

Best instant access rates are around 4.5% currently. Best regular saver accounts are up to 8%.

Ford money are paying 4.35 instant access at the moment. They are consistently good and nice to do business with. They have a very clear and east to access website.

Another good company is Kent Reliance. They have a slightly lower instant access account a slightly higher 60 day notice account.

For next year they both also have good rates on instant access ISAs.

I steer clear of providers offering excessively high rates.

I like Monument Easy Access, currently paying 4.55. It's regularly one of the top recommended on Martin Lewis website. You can boost the rate by transferring some to a notice account and transfer it back to the easy access in tranches as needed.
Very good app and easy to withdraw instantly.

Oops, just remembered I think Monument minimum required is £25k.

OP wants guaranteed interest every month, so Premium Bonds aren’t a feasible option.

I like the ease of Chip, they’ve got an easy access account paying 4.25% but there’s higher paying accounts out there.

There's another Monument account with a £1000 minimum. Have been using the Raisin app which is like a comparison site for savings accounts.

I like Chip too. Also the Prosper platform has been very easy to use / change accounts when interest rates change.

I get 4.75% from Chip and 4.97% through Prosper at the moment.

Also 4.89% with OakNorth. All very easy via their apps.