Turn on thread page Beta
    • Thread Starter
    Offline

    21
    ReputationRep:
    Hi everyone

    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!
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    It all depends what you want to use the money for and when you are likely to need it. But I wouldn't bother with a Cash ISA, the rates are abysmal. There are some current accounts with relatively high interest rates (click here and scroll down to see a list of the best rates).

    My suggestion would be to put £2000 into a TSB Classic Plus account. Then, open a Help to Buy ISA (Halifax currently has one offering 4%), you can deposit up to £1200 in your first month and another £200 each month thereafter. Any spare cash put into another high interest current account.
    • Thread Starter
    Offline

    21
    ReputationRep:
    (Original post by Snufkin)
    So...?
    I haven't had time to look into it yet, been busy with my current job and getting stuff sorted for my new one :ahee: I was planning to have a proper read through tomorrow, but thanks for the response :yy:
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    (Original post by Gofre)
    I haven't had time to look into it yet, been busy with my current job and getting stuff sorted for my new one :ahee: I was planning to have a proper read through tomorrow, but thanks for the response :yy:
    Oh okay, I just wasn't sure if you had seen it because I forgot to quote you. What is your new job? Sounds epic.
    • Thread Starter
    Offline

    21
    ReputationRep:
    (Original post by Snufkin)
    Oh okay, I just wasn't sure if you had seen it because I forgot to quote you. What is your new job? Sounds epic.
    I'm going to be doing sales/retail work on cruise ships. Boring work (and horrible hours!), but I'll get to travel the world for free for a while so I can live with that :ahee: Found out yesterday my first assignment will include 34 different ports mostly around the Mediterranean, so not a bad place to spend the summer :yep:
    Offline

    19
    ReputationRep:
    (Original post by Gofre)
    I'm going to be doing sales/retail work on cruise ships. Boring work (and horrible hours!), but I'll get to travel the world for free for a while so I can live with that :ahee: Found out yesterday my first assignment will include 34 different ports mostly around the Mediterranean, so not a bad place to spend the summer :yep:
    ISAs aren't dead - read Martin Lewis on the matter.

    From April ou can earn £1000 interest tax free so aim to build up a 'pot' in a high interest account. If you can lock it away you will get a higher rate of interest.

    The benefit of an ISA is that the interest is always tax free so when you have enough saved to over the £1000 interest [and if interest rates rise again that is not that much] they are useful.

    If you might want to buy a house then read about the new Help to buy ISAs but check the rules as there are quite a few!
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    (Original post by Muttley79)
    ISAs aren't dead - read Martin Lewis on the matter.

    From April ou can earn £1000 interest tax free so aim to build up a 'pot' in a high interest account. If you can lock it away you will get a higher rate of interest.

    The benefit of an ISA is that the interest is always tax free so when you have enough saved to over the £1000 interest [and if interest rates rise again that is not that much] they are useful.

    If you might want to buy a house then read about the new Help to buy ISAs but check the rules as there are quite a few!
    Huh? There is no Cash ISA which comes close to beating the top current accounts, even if you lock money away. You'd need over £70,000 in the top paying ISA before you went over the £1000 tax-free interest allowance, how likey is that? Cash ISAs are pretty much dead, they're only worth using if you have large amounts of money to save every year in the hope that interest rates go up eventually.
    Offline

    19
    ReputationRep:
    (Original post by Snufkin)
    Huh? There is no Cash ISA which comes close to beating the top current accounts, even if you lock money away. You'd need over £70,000 in the top paying ISA before you went over the £1000 tax-free interest allowance, how likey is that? Cash ISAs are pretty much dead, they're only worth using if you have large amounts of money to save every year in the hope that interest rates go up eventually.
    Have you read Martin Lewis? He is more of an expert that you are.

    Interest rates are historically low and once you reach £1 000 interest you shoud put the rest in an ISA ... protected forever there.

    If rates go up to 5% you only need £20 000 to be hit for tax.
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    (Original post by Muttley79)
    Have you read Martin Lewis? He is more of an expert that you are.

    Interest rates are historically low and once you reach £1 000 interest you shoud put the rest in an ISA ... protected forever there.

    If rates go up to 5% you only need £20 000 to be hit for tax.
    Worth remembering that you cannot have a Help to Buy ISA and a Cash ISA at the same time unless you settle for one of the ones which offer a bad rate. Given the amount he's thinking of putting in, it makes much more sense to go with a Halifax Help to Buy ISA which offers a very good rate and a high-interest current account than it does to get a Cash ISA.
    Offline

    19
    ReputationRep:
    (Original post by The Financier)
    Worth remembering that you cannot have a Help to Buy ISA and a Cash ISA at the same time unless you settle for one of the ones which offer a bad rate. Given the amount he's thinking of putting in, it makes much more sense to go with a Halifax Help to Buy ISA which offers a very good rate and a high-interest current account than it does to get a Cash ISA.
    Did I say you can have both? It is worth reading Martin Lewis - there are massive restrictions on the Help to Buy ISA.
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    (Original post by Muttley79)
    Did I say you can have both? It is worth reading Martin Lewis - there are massive restrictions on the Help to Buy ISA.
    You haven't stated what they are. In the event that he doesn't use the money in a HtB ISA to buy a home, he's still able to withdraw the money, interest and all, and it's still tax free. The main requirement for Halifax is a standing order by the 25th of the month, which is not terribly difficult if he's saving £400-£500 per month. I'm just saying that the HtB+Current Account option makes more sense in his circumstances given the amount he's saving as they offer better rates than Cash ISAs.
    Offline

    19
    ReputationRep:
    (Original post by The Financier)
    You haven't stated what they are. In the event that he doesn't use the money in a HtB ISA to buy a home, he's still able to withdraw the money, interest and all, and it's still tax free. The main requirement for Halifax is a standing order by the 25th of the month, which is not terribly difficult if he's saving £400-£500 per month. I'm just saying that the HtB+Current Account option makes more sense in his circumstances given the amount he's saving as they offer better rates than Cash ISAs.
    Look them up before you take one out - you don't get the bonus if you don't buy a house with it! You can only buy certain houses ...
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    (Original post by Muttley79)
    Look them up before you take one out - you don't get the bonus if you don't buy a house with it! You can only buy certain houses ...
    That's not the point. Regardless of whether you buy a house or not, it offers a better rate of interest on the amount you deposit than Cash ISAs. If you buy a house, then the bonus from the government is obviously a fantastic thing, but 4% remains far better than the pittance you get from the best easy-access Cash ISAs out there and that's given whether you use it for a house or not. If you're eligible, the Halifax ISA is basically a no-brainer.
    Offline

    19
    ReputationRep:
    (Original post by The Financier)
    That's not the point. Regardless of whether you buy a house or not, it offers a better rate of interest on the amount you deposit than Cash ISAs. If you buy a house, then the bonus from the government is obviously a fantastic thing, but 4% remains far better than the pittance you get from the best easy-access Cash ISAs out there and that's given whether you use it for a house or not. If you're eligible, the Halifax ISA is basically a no-brainer.
    You can only put in £200 a month ... and you can't have ever owned a house.
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    (Original post by Muttley79)
    You can only put in £200 a month ... and you can't have ever owned a house.
    I'm not sure you've actually looked at the OP. He's looking to save £400-£500pm, and you can quite reasonably infer from his demographics that he won't have owned a house. The amount he doesn't put into the Halifax HtB ISA will still earn more interest in a decent current account than a Cash ISA.
    Offline

    19
    ReputationRep:
    (Original post by The Financier)
    I'm not sure you've actually looked at the OP. He's looking to save £400-£500pm, and you can quite reasonably infer from his demographics that he won't have owned a house. The amount he doesn't put into the Halifax HtB ISA will still earn more interest in a decent current account than a Cash ISA.
    You can't ever assume! I had a house at his age.

    He wants to save far more than he'll be allowed in a HTB ISA ... yes he could get one but he needs to read Martin Lewis not listen to people on here who don't know the FULL circumstances.
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    (Original post by Muttley79)
    You can't ever assume! I had a house at his age.

    He wants to save far more than he'll be allowed in a HTB ISA ... yes he could get one but he needs to read Martin Lewis not listen to people on here who don't know the FULL circumstances.
    I'm not going to reply any further as I'm clearly getting nowhere. Your average 24 year old will not be a home-owner in this day and age. When the necessary deposit is much higher and house prices have risen significantly, the likelihood he is one is far far smaller than it might have been for you. Yes, his circumstances may be different, but in the vast majority of cases, a Cash ISA is a terrible suggestion compared to the HtB+Current Account combination and Martin Lewis does not necessarily provide specific advice. To portray Cash ISAs as better for the average case if he is eligible for the former would be grossly misleading.

    "Far more" is a hyperbolic statement. He would be looking to save £200-300 in excess of a HtB ISA which is why Snufkin and I recommend keeping the rest in a high-interest current account like the TSB Classic Plus account. The combination earns more in interest than stuffing it into the best Cash ISA, that's all we're saying.
    Offline

    19
    ReputationRep:
    (Original post by The Financier)
    I'm not going to reply any further as I'm clearly getting nowhere. Your average 24 year old will not be a home-owner in this day and age. When the necessary deposit is much higher and house prices have risen significantly, the likelihood he is one is far far smaller than it might have been for you. Yes, his circumstances may be different, but in the vast majority of cases, a Cash ISA is a terrible suggestion compared to the HtB+Current Account combination and Martin Lewis does not necessarily provide specific advice. To portray Cash ISAs as better for the average case if he is eligible for the former would be grossly misleading.

    "Far more" is a hyperbolic statement. He would be looking to save £200-300 in excess of a HtB ISA which is why Snufkin and I recommend keeping the rest in a high-interest current account like the TSB Classic Plus account. The combination earns more in interest than stuffing it into the best Cash ISA, that's all we're saying.
    Perhaps you should read my posts properly before crticising my advice? I don't think I recommended a cash ISA - I said they weren't 'dead' as a poster claimed - there are circumstances where they are OK if you have more than £1 000 interest coming in or when interest rates go up.

    We don't know the OP circumstances in detail - so he needs to read advice from an expert like Martin Lewis.
    • TSR Support Team
    Offline

    21
    ReputationRep:
    TSR Support Team
    With respect, Muttley79, I don't think you have a clue what you're talking about. Nowhere on Martin Lewis' website does it say Cash ISAs are better than high interest current accounts. Nor does it say there are "massive restrictions" on Help to Buy ISAs.

    ISA interest rates will not go up for a long time, if they ever do, so please stop telling the OP to open one - he shouldn't - it makes no financial sense.

    (Original post by Muttley79)
    there are circumstances where they are OK if you have more than £1 000 interest coming in or when interest rates go up.

    We don't know the OP circumstances in detail - so he needs to read advice from an expert like Martin Lewis.
    As I have already said, you would need more than £70,000 in the current best rate ISA to go over the £1000 allowance. The OP doesn't even have 5k and is in no danger of going over the limit. I'm not going to repeat myself again.
    Offline

    19
    ReputationRep:
    (Original post by Snufkin)
    With respect, Muttley79, I don't think you have a clue what you're talking about. Nowhere on Martin Lewis' website does it say Cash ISAs are better than high interest current accounts. Nor does it say there are "massive restrictions" on Help to Buy ISAs.

    ISA interest rates will not go up for a long time, if they ever do, so please stop telling the OP to open one - he shouldn't - it makes no financial sense.



    As I have already said, you would need more than £70,000 in the current best rate ISA to go over the £1000 allowance. The OP doesn't even have 5k and is in no danger of going over the limit. I'm not going to repeat myself again.
    Snufkin - you said Cash ISAs are dead - that is not true - please stop misreading my posts.

    Nowhere did I say the OP should take one out - I said for some people they are relevant.

    You need to keep a constant watch on interest rates -

    There are restriction on the house you can buy - it must be under £250 000 [more in London] - very little available for that price in some areas even starter homes.
 
 
 
Reply
Submit reply
Turn on thread page Beta
TSR Support Team

We have a brilliant team of more than 60 Support Team members looking after discussions on The Student Room, helping to make it a fun, safe and useful place to hang out.

This forum is supported by:
Updated: February 24, 2016
Poll
Do you think parents should charge rent?

The Student Room, Get Revising and Marked by Teachers are trading names of The Student Room Group Ltd.

Register Number: 04666380 (England and Wales), VAT No. 806 8067 22 Registered Office: International House, Queens Road, Brighton, BN1 3XE

Write a reply...
Reply
Hide
Reputation gems: You get these gems as you gain rep from other members for making good contributions and giving helpful advice.