Topic: Savings accounts, ISA's etc

[LiamG]

So i've finally come to realise that i desperately need to start saving more money in my life! So i'm looking at getting a savings account, But i'm so confused by it all!

Am i right in saying the interest on an ISA account is tax free? But i don't get this bit
" For the current 2013-14 tax year, the annual ISA allowance is £11,520, but only £5,760 of that may be used for a cash ISA."

Does that mean only up to 5,760 in savings would be tax free?


I'll probably put about £500 in the savings each month and probably won't access it until next year! So any recommendations for what to get and what would be best for me because i have not got a clue!

[WhoHe]

Yes the interest is tax free, you can have a stocks and shares ISA as well as a cash isa so that means only £5, 760 can be in a cash ISA the rest must be in shares one, I think ! Sure someone on here knows more.
To be honest the level of interest is absolutely pathetic, could be worth looking at tracker funds - which I have been menaing to do for ages but again they can be pretty complicated. Trackers basically follow a market index e.g. FTSE, so go up when the index does, there are more risky ones as I understand that for example track Chinese or Russian markets so can be volatile investments.

I would read up on Martins Moneysavers site (or others) and if you are talking investing a few quid then I would talk to an independent financial advisor.

[G1 Jockey 4(betfair)]

shame savings rates are really bad atm.
in most cases your losing money with inflation.

[Grobbelrevell]

To be honest the level of interest is absolutely pathetic

They really are.

I recently had a look on moneysupermarket.com to see which savings accounts offered the best interest rates. The highest rate on the market it seems, is 3.25% with Barclays, but that only allows you a maximum of £3,000 per year. The highest cash ISA was 2% (with Nationwide), with the majority being 1.5%.

Quite honestly, you'd probably be as well just putting it under your mattress.

[CHOPPER]

Liam, you're 27 for fucks sake mate. Go and blow some money on some brasses, get to a few away games, get out 4 nights a week, enjoy yourself man! Live a little.



*This was a public service announcement by the Monday Club*

[Spongebob Redpants]

With current interest rates , all you can really do is make the best of the shit deals available .

Premium Bonds offer shit odds of winning , but unless you've got a fair chunk to put away it might be worth a punt with them .

[sminp]

If you've got a mortgage that allows you to withdraw any overpayments you make then you're likely to be much better off doing that

[jaffod]

Liam, you're 27 for fucks sake mate. Go and blow some money on some brasses, get to a few away games, get out 4 nights a week, enjoy yourself man! Live a little.



*This was a public service announcement by the Monday Club*

Words of wisdom.....you should do all those things and just blow the rest.

[LiamG]

Liam, you're 27 for fucks sake mate. Go and blow some money on some brasses, get to a few away games, get out 4 nights a week, enjoy yourself man! Live a little.



*This was a public service announcement by the Monday Club*

Haha i'm still living with my parents mate, The pressure on me to move out has been increasing year on year lol

I work for Tesco, i could join the "save as you earn scheme" which gives me the option of buying shares at the end of each year i think, haven't properly looked into it!

Anyway, i need somewhere to put the money to stop me from spending it! Wether the interest rates are poor or not

[El Phes]

I work for Tesco, i could join the "save as you earn scheme" which gives me the option of buying shares at the end of each year i think, haven't properly looked into it!

I'M GOING TO SHOUT ABOUT THIS BECAUSE ITS THE BEST THING YOU CAN DO......PUT AS MUCH MONEY AWAY EACH MONTH (£250?) IN YOUR COMPANIES "SAVE AS YOU EARN" SCHEME...DO IT FOR THE MAXIMUM TERM ALLOWABLE (7 years maybe?) AND COME BACK ON HERE IN 7 YEARS TIME TO THANK ME PROFUSELY FOR HOW RICH I HAVE MADE YOU. If you have any spare cash to invest after that, come back on here. 


Just found a good example with a parent company I used to work for many moons ago...Prudential. Lets say you entered the scheme 5 years ago (with a 5 year term), the Pru's share price was 270p (£2.70). The SAYE scheme would give you a price 10% cheaper "I think" because you work there, so 245p (£2.45) for clear workings. That means that in 5 years time, your money saved will be able to buy the amount of shares at the price 5 years ago, but will be worth the price of today. So, you save £250 per month for 5 years, that gives you £15,000 (plus interest!) So, when your scheme matures (5yrs from now) you can now buy your shares...

£15,000 divided by £2.45 = 6122 shares.

Now the good bit....the Pru's share price today is 1115p or £11.15 per share. Multiply your amount of shares with todays price......6122 shares x £11.15 and you get £68,260!!!!

This actually works mate, I've seen it happen and unfortunately, not to me because I didn't get advised clearly enough when I was younger. It's 1 of the biggest mistakes in my life...believe me, I remember it well.

Now, the serious bit.....shares can go up as much as they can go down, BUT, your savings are safe, they earn interest and if the share price is lower at maturity than when you 1st put 'your line in the sand' at Day1, they just pay you back what you saved. No real loss, but a no real gain either. When I was close to these schemes over 20 years ago, you could have 1 scheme running each year, so get your £250 saved each month in year 1 and then start saving your 'other' £250 in year 2 also (so you'll be saving £500 per month from year 2 onwards. Of course, you can still save the 'extra' £250 in year 1, but just not in your companies SAYE scheme.)

I hope you read this, take it in, and I hope the 'rules' are as favourable for you now as they were for us 20 years ago.

[Cruiser]

With current interest rates , all you can really do is make the best of the shit deals available .

Premium Bonds offer shit odds of winning , but unless you've got a fair chunk to put away it might be worth a punt with them .

Got the max £30k in premium bonds and only get 1 or 2 £25 prizes a month. Nothing else.

Most my savings are put away in long term bonds with slightly better interest rates but once they mature the rates for further bonds are shit.

[LiamG]

Well i've requested more info on it and gonna look into the Tesco save as you earn one, I might need access to the savings within the next 12 months (if i move out for example)

like i said though, as long as i'm putting my money away somewhere for me not to spend! Under the bed just wouldn't work lol

[El Phes]

Well i've requested more info on it and gonna look into the Tesco save as you earn one

yeah, don't mention it mate 

[LiamG]

yeah, don't mention it mate 

Sorry bud, Thanks for breaking it down for me

[Joff]

yeah, don't mention it mate 

This is good advice. I did the same thing with Sainsburys 8 years ago. Got me a house 5 years ago, well, the deposit. We invested 7k, got out almost 9k, art one point we were looking at 21k, but the stock market fell out of it's arse. But you can't lose if you take the cash. Doing it again now.

[Fordy]

Well i've requested more info on it and gonna look into the Tesco save as you earn one, I might need access to the savings within the next 12 months (if i move out for example)

like i said though, as long as i'm putting my money away somewhere for me not to spend! Under the bed just wouldn't work lol

Money can't buy a life mate.

Live your life.

When you're 40+ and all you've is a few quid in a bank then it will be too late to live a little.

[Joff]

Money can't buy a life mate.

Live your life.

When you're 40+ and all you've is a few quid in a bank then it will be too late to live a little.

What a load of bollocks.

[Grobbelrevell]

What a load of bollocks.

Not really. There's certainly a balance to be struck between enjoying yourself today and planning for tomorrow.

[Joff]

Not really. There's certainly a balance to be struck between enjoying yourself today and planning for tomorrow.

Who says you can't do both? I find life it's a lot more enjoyable knowing I have the means to pay for out for any problem that might come my way, or if I want something, I can pay for it without borrowing.

[Fordy]

What a load of bollocks.

How is it?

[Fordy]

Who says you can't do both? I find life it's a lot more enjoyable knowing I have the means to pay for out for any problem that might come my way, or if I want something, I can pay for it without borrowing.

That's boring though.

I would rather travel the world and live a little then sat looking at my bank balance.

You only live once!!!

[Grobbelrevell]

Who says you can't do both?

That's kind of the point I was making - there needs to be a balance.

[paddysour]

That's boring though.

I would rather travel the world and live a little then sat looking at my bank balance.

You only live once!!!

Yet you have 21,000 posts on here 

[LiamG]

That's boring though.

I would rather travel the world and live a little then sat looking at my bank balance.

You only live once!!!

I agree to a point, I mean i'm lucky i average 3 holidays a year! But on the other hand, i'm still living at home with my parents and at the age of 28 i really need to start looking at getting my own place

I am lucky they have never kicked me out, but the pressure from them has been increasing lately, So i'm hoping to have my year next year (Vegas and 3 months in ibiza?) and then i will move out

[LanceLink!!!!!]

'I spent a lot of money on booze, birds and fast cars. The rest I just squandered.' - George Best

[L666KOP]

That's boring though.

I would rather travel the world and live a little then sat looking at my bank balance.

You only live once!!!

You're right mate, you do only live once, and from being 21 years old I have followed that mantra, and I found myself in the shit because of it.

I was always earing big money, and enjoyed the trappings of a 'kid' on a grand a week 20 years ago. Fast cars, out on the ale every night, etc, I didn't need to save money, I earned it quicker than I could spend it.
Then the building game collapsed, had to sell my car, had to stop going out. Basically lived like a hermit for 12 months.

I've had a few periods in my working life where I've been on serious wages, but spunked the fucking lot.

In 2004/5 I was earning £656 a week after tax, I decided I was gonna fully embrace the European cup. Went to every game, barring Juventus and Olympiakos away games.
Paid 400 notes for a ticket in the Mathew Harding stand, paid 400 for a ticket to the final, never baulked at paying a fiver a pint in the beer tent at Sabia Gochen, 9 hrs I was in there, but it didn't matter because I was 'loaded'. That year I spent over 4 grand, just on the European cup.

Now then, do I wish I'd have put some away ? Fucking dead right, especially when we had to sell our £275k house because we couldn't meet the mortgage payments of £850 a month due to a back injury.

Between 2004, and 2009,my 'worst' year was £47k gross profit, my wife was a Paramedic on almost £30k a year, but we had a least 3 foreign holidays a year, new cars, big posh grade 2 listed detached house, 3 grand watches a piece, but fuck all in the bank.

Don't get me wrong, certain parts I wouldn't swap for anything, but you tend to get swept along on a tidal wave of spending.

I'd suggest to OP that if he can realistically save 500 a month then put the first 500 under the mattress, keep it there for treats, and/or emergency money. Every pay day thereafter, top the fund back up to 500, and what's left put it well out of reach.

Having money is not the be all and end all, but it sure takes the sting out of being poor.
 

[henry]

there is a chinese saying which i was brought up to -  "first sour then sweet".

I don't have any saving myself but i do top up my work pension to the max (which i get the most company contribution) and overpay my mortgage each month even if that is just £50 or less.

the interest rate is so low now that if your mortgage interest is higher than your saving account interest, then you actually better off overpaying your mortgage instead.

i live within my spreadsheet which is abit sad but then i know that if shit hit the fan, my wife and i would still be ok as "my spreadsheet say so" - always plan for the worst case scenario.

in the long run and we would be able to enjoy the reward and hopefully early retirement as an option then all this discipline living would be well worth it.
 

[L666KOP]

there is a chinese saying which i was brought up to -  "first sour then sweet".

I don't have any saving myself but i do top up my work pension to the max (which i get the most company contribution) and overpay my mortgage each month even if that is just £50 or less.

the interest rate is so low now that if your mortgage interest is higher than your saving account interest, then you actually better off overpaying your mortgage instead.

i live within my spreadsheet which is abit sad but then i know that if shit hit the fan, my wife and i would still be ok as "my spreadsheet say so" - always plan for the worst case scenario.

in the long run and we would be able to enjoy the reward and hopefully early retirement as an option then all this discipline living would be well worth it.

It's not sad at all mate, far from it.
It shows you have a firm grip on your finances.

And one thing I would add.

Never, ever, purchase anything unless you have the money in the bank.
The only credit should be a motgage.

If everyone saw their car as a 'tool' to get a job done, rather than an 'impression maker' there'd be no need for finance.

[Joff]

People using George Best as an example of 'live fast die young'. I hope they are being ironic.

[Joff]

I also get an immense satisfaction from the sleep I now get, rather than tossing and turning when I was skint, worrying about how I was going to pay the bills the next month. I still enjoy myself. Member of a decent golf club, ok I don't go abroad at the moment, but that's more to do with 2 young kids and the restrictions they put on what you can do.

[Joff]

Still get to go out to see my mates. I just don't live life on tick anymore. I enjoyed it when I did, but fuck me, life is 'better' now. No doubt.

[ThepepeReina]

Convincing us or yourself? 

[Rigden]

Quick question regarding bank accounts in the UK. I've moved, but I still have a bank account in the UK which I would like to keep, is this possible? I know there are some European countries which won't allow this. I've searched for answers online, but it mainly comes up with expats seeking to open a bank account while still living abroad. Thanks.

[WhoHe]

Think you would only need to have an address in the UK, how would they know you have moved ?

[gazzam1963]

The information you have been given about your share save scheme is probably your best bet for £250 a month of your money . First off it will be 20% off the share price when you start . You'll get two choices a three year or five year . It's a win win situation share save . You either take out the shares if there higher than the option price ( even if the actual share price doesn't move your shares will return 20 % anyhow . Or if there lower than the option price you just take the cash . You can take the money out at any time and ( well my wifes one ) you can have a six month holiday from payments .

One thing I'd say is go for the full allowance as if it's over subscribed you'll get less . Can't comment on tesco Themselves but there share price has been 440 pence in the last three years  , today it's 372 pence if sharesave was being opened today the option price would possibly be 305 pence..ish . And if it does really well as the economy recovers you'd be quids in . From personal experience it can be a fantastic investment so go for it

[LiamG]

Plus i will get my free shares that we get each year on top of that!

I just need to find out for certain how much i can save each month with them

*Edit* Found out, Can only save £50 a month with it

[gazzam1963]

Plus i will get my free shares that we get each year on top of that!

I just need to find out for certain how much i can save each month with them

*Edit* Found out, Can only save £50 a month with it

Can you join it at any time , or just one period during the year ? , can i ask who is giving you this information
Edit;  just had a look and it's a save as you earn plan similar to share save , your right it has to be £50 every four weeks and you can join anytime after a years service . Worth putting the maximum in as one outlet for your money . What i did note is they do a share incentive plan (sip) , we have one of these and it is generally only open tom certain grades of staff . Your money is at more of a risk but greater rewards .

Basically you pay up to £125 a month into buying shares
The company also buys shares for you at the same value
So eg you buy £125 , they buy £125 you have £250 worth of shares
Your £125 is taken before tax and NI so you actually only pay £125 minus 30%

Downside is you have to keep them for five years after that they come on stream
When you sell no tax , no NI and also no capital gains tax .
The shares you buy are always available to sell within the five year period but subject to tax and NI

[Giz a Gobble]

I take it there's no way into this if you work in education then? I'd be keen to do this as the cash we're saving for a house so far is just going into an ISA and as has been said, it isn't gaining any interest effectively so any other ways would be interesting.

[El Phes]

I take it there's no way into this if you work in education then? I'd be keen to do this as the cash we're saving for a house so far is just going into an ISA and as has been said, it isn't gaining any interest effectively so any other ways would be interesting.

No way mate, unless you have a VERY good friend or family member willing to contribute on your behalf, with your money and you take the rewards at the end. Could get tricky unless you completely trust them.

[Joff]

Maximum of 50? Sounds odd. Sainsbury's is 250. 50 a month doesn't seem like a big enough investment to make it worthwhile. 600 maximum a year.