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My savings plan - critique welcome. Watch

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    Me and my partner have about £15,000 or so. Its possible though not probable, that we will buy a house in the next 5 years. Looking for (very) low risk savings options. This is what i plan to do with it:

    1) Nationwide Help to Buy cash ISA* - 2.00% - fill it to the max (£2400 initial, £400 per month.
    They have a startup £200 bonus that makes it more attractive than the higher interest Barclay's one. The help to buy scheme makes this pretty lucrative if we do buy a house too.

    2) Next overflow: Nationwide regular saver 5%, max out at £500 per month. The personal savings allowance will keep this tax free.

    3) Less sure - so much volatility in stocks and shares atm. Might just plug for keeping my cash ISA allowance high - my current one earns 0.6% but could get higher.

    Thanks for reading and comments welcome.
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    For the most part this makes sense.

    Once the LISA becomes available in April I'd suggest transferring your H2B ISA into here so that you can make the higher annual contribution of £4000/year each instead of £200/month. If you each open a H2B this month and a LISA in April you'll immediately have moved £11,200 of your savings into an ISA wrapper and be eligible for a 25% bonus on all of it.

    Might just plug for keeping my cash ISA allowance high
    Remember that a H2B ISA is a cash ISA, so you cannot make subscriptions into both a H2B and Cash ISA within the same tax year.
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    (Original post by estel)
    Remember that a H2B ISA is a cash ISA, so you cannot make subscriptions into both a H2B and Cash ISA within the same tax year.
    You can with Nationwide - something about a loophole.

    Thanks for your advice - the LISA does indeed sound interesting, if the rates are ok.
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    (Original post by nexttime)
    You can with Nationwide - something about a loophole.

    Thanks for your advice - the LISA does indeed sound interesting, if the rates are ok.
    Oh neat, I forgot they had a combined H2B / cash ISA wrapper. It'll be interesting to see what LISA products are available in a few months - I hope there will be some decent options. LISAs can wrap with a cash or stocks and shares account, so you'd have a lot of flexibility if you want to move to a equity/bond mix (obviously mostly bonds with your timeframe).
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    Seen a lot of people put funds into Premium bonds via NS&I, worth a look at, even though it is luck of the draw.
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    (Original post by nexttime)
    Me and my partner have about £15,000 or so. Its possible though not probable, that we will buy a house in the next 5 years. Looking for (very) low risk savings options. This is what i plan to do with it:

    1) Nationwide Help to Buy cash ISA* - 2.00% - fill it to the max (£2400 initial, £400 per month.
    They have a startup £200 bonus that makes it more attractive than the higher interest Barclay's one. The help to buy scheme makes this pretty lucrative if we do buy a house too.

    2) Next overflow: Nationwide regular saver 5%, max out at £500 per month. The personal savings allowance will keep this tax free.

    3) Less sure - so much volatility in stocks and shares atm. Might just plug for keeping my cash ISA allowance high - my current one earns 0.6% but could get higher.

    Thanks for reading and comments welcome.

    I don't really know but isn't there a help to buy scheme which gives you 20% of the house value? Also you only need a 5% deposit which you seem to have. So couldn't you buy a £300k house now? Provided you both can get a mortgage and pay the bills. You could also get tenants.
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    (Original post by Emz99)
    I don't really know but isn't there a help to buy scheme which gives you 20% of the house value? Also you only need a 5% deposit which you seem to have. So couldn't you buy a £300k house now? Provided you both can get a mortgage and pay the bills. You could also get tenants.
    Are you thinking of this?

    http://www.moneysavingexpert.com/savings/lifetime-ISAs
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    idk I am not buying a house anytime soon. I am too tired to check that link
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    (Original post by Emz99)
    I don't really know but isn't there a help to buy scheme which gives you 20% of the house value? Also you only need a 5% deposit which you seem to have. So couldn't you buy a £300k house now? Provided you both can get a mortgage and pay the bills. You could also get tenants.
    Yes the help to buy ISA does that (its 25%, though only on houses up to the value of £250k and you can't buy to let with it).

    The lifetime ISAs, to be released in April, will also do that.

    Technically could afford a house now but a) job moves every year (ffs) b) don't trust the property market atm c) no need to take on more debt that i need to - higher deposit + smaller mortgage = greater financial stability.
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    (Original post by nexttime)
    Yes the help to buy ISA does that (its 25%, though only on houses up to the value of £250k and you can't buy to let with it).

    The lifetime ISAs, to be released in April, will also do that.

    Technically could afford a house now but a) job moves every year (ffs) b) don't trust the property market atm c) no need to take on more debt that i need to - higher deposit + smaller mortgage = greater financial stability.
    Nice to hear man. It's good your working hard. I think you can't give away the whole house but you could do so a room? Regarding house prices they will only increase/ remain stable, well where I live but I guess I don't really know your area....
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    (Original post by nexttime)
    Me and my partner have about £15,000 or so. Its possible though not probable, that we will buy a house in the next 5 years. Looking for (very) low risk savings options. This is what i plan to do with it:

    1) Nationwide Help to Buy cash ISA* - 2.00% - fill it to the max (£2400 initial, £400 per month.
    They have a startup £200 bonus that makes it more attractive than the higher interest Barclay's one. The help to buy scheme makes this pretty lucrative if we do buy a house too.

    2) Next overflow: Nationwide regular saver 5%, max out at £500 per month. The personal savings allowance will keep this tax free.

    3) Less sure - so much volatility in stocks and shares atm. Might just plug for keeping my cash ISA allowance high - my current one earns 0.6% but could get higher.

    Thanks for reading and comments welcome.
    I expect (sounds like) from your comments that you will be a while before you buy a property. If the timescale is at least a few years, maybe a stocks and shares ISA might be worth going for, but using managed funds - the Hargreaves and Lansdown one generally has low charges and the most options. You probably won't make a fortune, but with some careful consideration, you could make more than the low rates that cash ISAs follow.

    The other obvious place to look now is crowdinvesting platforms - there are interesting ones with fairly solid performance and better-than-ISA returns but of course more risk. The ones that invest in environmental projects have a good rate of return historically.
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    (Original post by BBS_)
    Seen a lot of people put funds into Premium bonds via NS&I, worth a look at, even though it is luck of the draw.
    Hell no. Expected return rate is far lower than a good savings product.

    (Original post by Emz99)
    I don't really know but isn't there a help to buy scheme which gives you 20% of the house value? Also you only need a 5% deposit which you seem to have. So couldn't you buy a £300k house now? Provided you both can get a mortgage and pay the bills. You could also get tenants.
    That would be the Help To Buy Equity loan for new builds: https://www.helptobuy.gov.uk/equity-loan/equity-loans/ If you can afford it it's always better to get a larger deposit to minimise the LTV and get better mortgage rates.

    The maximum mortgage you're likely to receive from a bank is 4 - 4.5x your annual salary, so someone would need a combined salary of about ~ £60,000 to afford a £300k house with a 20% deposit.
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    (Original post by estel)
    That would be the Help To Buy Equity loan for new builds: https://www.helptobuy.gov.uk/equity-loan/equity-loans/
    Its not just for new builds any more.
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    (Original post by nexttime)
    Its not just for new builds any more.
    The H2B ISA is not, but the H2B Equity Loan scheme is.
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    (Original post by estel)
    The H2B ISA is not, but the H2B Equity Loan scheme is.
    Ah interesting.

    Educational thread!
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    Now is very much not the time to buy a house in my opinion. Help To Buy or no Help to Buy. Far too much economic uncertainty to commit to the biggest purchase you're likely to make in your life, particularly when values are so high.
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    (Original post by nexttime)
    1) Nationwide Help to Buy cash ISA* - 2.00% - fill it to the max (£2400 initial, £400 per month.
    They have a startup £200 bonus that makes it more attractive than the higher interest Barclay's one. The help to buy scheme makes this pretty lucrative if we do buy a house too.
    You cannot use a Help to Buy ISA to contribute towards a house deposit or for any fees. Make sure you've saved enough for all of this outside of the Help to Buy ISA.
 
 
 
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