Billy Basic Savings & Investment advice!
Discussion
In a position where we've got about £20k sat around not doing much at the moment and trying to decide what to do with it plus a flexible amount each month of between £200 & £400
Mortgage is fixed for a further 8 years at 2.21%
No other debt
Have a rainy day fund to cover emergencies.
So thinking of putting £15k into a S&S ISA one of the global tracker type thingies. Comfortable with mid range risk. - intent to leave it there until re-mortgage time at the earliest & topping up each month with the 2-400 quid?
£5k into a high interest savings account - just incase - so move it around the Chase / other providers offering increased % accounts for the time being.
Higher rate tax payer.
I know these aren't earth shattering values but it'd be nice to know it's doing something other than just sat in my current account.
Anything obvious i'm missing?
Mortgage is fixed for a further 8 years at 2.21%
No other debt
Have a rainy day fund to cover emergencies.
So thinking of putting £15k into a S&S ISA one of the global tracker type thingies. Comfortable with mid range risk. - intent to leave it there until re-mortgage time at the earliest & topping up each month with the 2-400 quid?
£5k into a high interest savings account - just incase - so move it around the Chase / other providers offering increased % accounts for the time being.
Higher rate tax payer.
I know these aren't earth shattering values but it'd be nice to know it's doing something other than just sat in my current account.
Anything obvious i'm missing?
Stick the whole lot in S&S ISA and make sure the balance of what you buy fits your risk profile. i.e.
x% - Stocks & Shares funds
y% - Bond funds and/or Money Market funds
Back in the day a standard approach was x = 60% and y = 40% for long term planning but the world's moved on a bit since then with, typically, a bigger x and a smaller y.
Stocks & Shares look to be riding very high at the moment but that's not to say it won't continue. On the the other hand bear in mind sudden 20% drops like Covid and Ukraine. They do happen and can hit fast and hard.
x% - Stocks & Shares funds
y% - Bond funds and/or Money Market funds
Back in the day a standard approach was x = 60% and y = 40% for long term planning but the world's moved on a bit since then with, typically, a bigger x and a smaller y.
Stocks & Shares look to be riding very high at the moment but that's not to say it won't continue. On the the other hand bear in mind sudden 20% drops like Covid and Ukraine. They do happen and can hit fast and hard.
I think given the added drip feed then making use of your SS ISA allowance ( and perhaps your wife’s /partner too ) seems a decent compromise and it’s not as if you won’t be get to any part of it should the emergency need arise.
If you are wanting to leave £5k “ alone because “ then perhaps a notice period savings account is a better bet than a term account.
Or if you really want to play safe whilst keeping the ability to earn more than a current account maybe £10k ISA ( plus then the monthly drip ) £5k notice account and £5k PB’s - as a higher rate tax payer this carries more weight albeit return per se will be limited on that quantum - unless you get very very lucky obviously.
After a year of whatever option you can then revisit the drip quantum etc.
If you are wanting to leave £5k “ alone because “ then perhaps a notice period savings account is a better bet than a term account.
Or if you really want to play safe whilst keeping the ability to earn more than a current account maybe £10k ISA ( plus then the monthly drip ) £5k notice account and £5k PB’s - as a higher rate tax payer this carries more weight albeit return per se will be limited on that quantum - unless you get very very lucky obviously.
After a year of whatever option you can then revisit the drip quantum etc.
Thanks all, some useful food for thought in there!
Maybe i should just buy some gold bars...
Any preference for providers for S&S ISA? I've got an account with Hargreaves Lansdown as that's where the kids S&S ISAs are.
Any reason not to use them for mine too?
Main bank is with Natwest if they offer anything interesting?
Maybe i should just buy some gold bars...
Any preference for providers for S&S ISA? I've got an account with Hargreaves Lansdown as that's where the kids S&S ISAs are.
Any reason not to use them for mine too?
Main bank is with Natwest if they offer anything interesting?
Need instant access to a guaranteed amount?
Cash ISA / Savings account at circa 4%. But also bear in mind that 4% interest is in real terms making you sweet FA when pegged against inflation... It's literally zero growth.
Flexibility to make a withdrawal timed to the market (6 months)?
S&S ISA portfolio split as you wish but S&P 500 and FTSE Developed Vanguard funds, but at a lower cost to you via InvestEngine/Trading212 (I use the former).
The stock market historically returns 11%, and if you look at the past 5 years, even with COVID and Trump's tariff circus the markets only dipped for 6 months before surpassing the point it dropped.
If you can survive that 6 month dip before needing the money, there is no question S&S is where I'd go out it. Compounding interest in a tax fee vehicle (that will ultimately surpass your 20k limit) is unmatched, especially if you choose accumulating funds for which the dividends will also be compounded.
TLDR: Max S&S ISA, Pension contributions and minimise the amount you have in crappy 4% interest accounts. Make the money work.
Cash ISA / Savings account at circa 4%. But also bear in mind that 4% interest is in real terms making you sweet FA when pegged against inflation... It's literally zero growth.
Flexibility to make a withdrawal timed to the market (6 months)?
S&S ISA portfolio split as you wish but S&P 500 and FTSE Developed Vanguard funds, but at a lower cost to you via InvestEngine/Trading212 (I use the former).
The stock market historically returns 11%, and if you look at the past 5 years, even with COVID and Trump's tariff circus the markets only dipped for 6 months before surpassing the point it dropped.
If you can survive that 6 month dip before needing the money, there is no question S&S is where I'd go out it. Compounding interest in a tax fee vehicle (that will ultimately surpass your 20k limit) is unmatched, especially if you choose accumulating funds for which the dividends will also be compounded.
TLDR: Max S&S ISA, Pension contributions and minimise the amount you have in crappy 4% interest accounts. Make the money work.
Dan_1981 said:
In a position where we've got about £20k sat around not doing much at the moment and trying to decide what to do with it plus a flexible amount each month of between £200 & £400
Mortgage is fixed for a further 8 years at 2.21%
No other debt
Have a rainy day fund to cover emergencies.
So thinking of putting £15k into a S&S ISA one of the global tracker type thingies. Comfortable with mid range risk. - intent to leave it there until re-mortgage time at the earliest & topping up each month with the 2-400 quid?
£5k into a high interest savings account - just incase - so move it around the Chase / other providers offering increased % accounts for the time being.
Higher rate tax payer.
I know these aren't earth shattering values but it'd be nice to know it's doing something other than just sat in my current account.
Anything obvious i'm missing?
Mortgage is fixed for a further 8 years at 2.21%
No other debt
Have a rainy day fund to cover emergencies.
So thinking of putting £15k into a S&S ISA one of the global tracker type thingies. Comfortable with mid range risk. - intent to leave it there until re-mortgage time at the earliest & topping up each month with the 2-400 quid?
£5k into a high interest savings account - just incase - so move it around the Chase / other providers offering increased % accounts for the time being.
Higher rate tax payer.
I know these aren't earth shattering values but it'd be nice to know it's doing something other than just sat in my current account.
Anything obvious i'm missing?
You do have a sensible plan.
Your mortgage rate has worked out well. No need to pay that off, when you can earn more with a savings account.
My only suggestion, if you want some in cash, would be put your £5,000 into a cash ISA.
That then uses your full 2025/26 allowance.
Yorkshire Building Society are easy to deal with and I think their rate is 4%.
There is eventually always advice on here to pay into a pension.
Tax relief on the way in and tax on the way out. That is now, goodness knows what rules future governments will introduce.
With ISAs, no tax relief on the way in, but no tax on the way out.
Can take out at any time, unlike a pension.
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