Based in your circumstances (Initial deposit £1-2K. I'll assume a median of £1500) followed by £400-500 p.m., I'd recommend:(Original post by Gofre)
So yeah, next month I will hopefully be starting a new job which will let me see a nice chunk of the world over the next few years, but I will also most likely not get very much time to spend my salary! So I figured that, at the ripe old age of 24, I should probably start saving some of that cash. The problem is I have no idea where to start looking!
I don't know exactly how much I'll be putting away each month as it's likely to vary depending on where in the world I am, but I would guess at an average somewhere in the region of £400-£500 per month. I will also be getting a bonus from my current job next month allowing me to make an initial deposit of £1000-£2000, if that's at all relevant. I currently bank with Natwest if that's of any relevance too.
Any suggestions would be greatly appreciated!
1) Halifax 4% Help to buy ISA - Initially deposit £1200 to maximise the potential of this account. Then deposit £200 monthly.
2) First Direct Current account - Switch from your current bank to first direct and get £150. This is equivalent to saving £1000 at a 15% rate for a year, so it's a good bonus to have.
One point to make though, to receive the bonus £150, you have to deposit £1000 within the first 3 months of opening the account, which shouldn't be a problem. Just make sure you deposit that initial bonus into the account before opening the halifax account.
3) First Direct Regular Saver - 6% interest - Where you can save up to £300 a month. But you have to be able to save regularly for at least a year. Pros: Forces you to save regularly, high interest, fits your budget as you can vary the amount each month if you want. Cons: You have to save every month.
You can deposit the remaining £300 from your initial bonus here to start you off.
The above scenario allows you split your £500 a month perfectly between a 4% and a 6% rate, and they are both flexible in that you don't have to put in the maximum but the option is there.
The alternative TSB account at 5% is fine too but it is capped at £2000. So if you manage to save £300 a month in that account you'll reach the limit in 7 months. I wouldn't recommend it if you're going to be doing this 'over the next few years'.
Hope this helps.
...we were on a break