What should I do with a Business cash surplus?

[JakeR]

Hi folks, my business runs a fairly large cash surplus as our cashflow is a rollercoaster.

At present, we have the money on an overnight sweep, as we need to have pretty quick access to the money (48hrs max really).

We currently get a fairly pathetic return on it, and I was just wondering if there was something smarter to do, now that the banks are all desperate for money ?

thanks

JakeR

[khushy]

smarter???? . . . . invest in something comfy to sleep on - super king size by the sounds of it!!!!!!!


Helibeds deliver same day - instant access???

khushy

[Brown and Boris]

I run four accounts alongside the curent account.

One pays a good rate but requires 30 days notice and I keep the corporation tax and some VAT in there, along with money I know we don't need this month.

Two are a decent rate but I lose interest if a withdrawl is made in any month so I move it all from one to the other at the start of each month via the current account and cream off what i think I wil need for the month as it goes through. That way I still get interest on the money that ends up in one of the savings acounts.

One pays poor interest, but gives instant access which is where I keep money I know we will need this month.

Does require a bit of planning and messing about.

Then we waste shed loads of that interst and the cash itself by putting it into managed funds wehn the stock market is playing silly beggars.

Edited by Brown and Boris on Thursday 2nd October 10:06

[oedo]

Do you have a business manager? Speak to him/her, I know for a fact they should have some pretty attractive rates that are negotiable (it's what I do). If you're not particularly loyal to one bank then shop around. To attract business banks will typicaly offer higher rates on deposits that are new to them than on existing funds.

[POORCARDEALER]

"Overnight" rates are generally quite low, my wife used to invest upwards of £100M + on the overnights and even on sums this large the returns were poor........also if you could manage to get a rate that half decent it was often difficult to get all of it placed, particually just beofre the daily cut off.

[Bernie-the-bolt]

We simply have two accounts with HSBC, one is a current account with a minimum balance of £10K which is swept daily into a deposit account that holds the balance of our cash.

The interest rate on both is circa 4.5% gross which is paid monthly, obviously any interest paid is elegable for CT within our accounts.

I have had quite large sums in various bonds over the last year or so but those rates aren't looking very good currently so I've left money in the deposit account as the difference is pence and not worth mucking about with.

This works for me and requires minimum involvement from my end on a daily basis.

ETA...This system allows instant access to all of our money on a daily basis if need be as I have a large transfer agreement with HSBC.

Edited by Bernie-the-bolt on Friday 3rd October 11:57