Hello everyone! If you’re lucky enough to have spare cash and a lot is sitting in bank accounts, it would be better off if more of it went into higher-returning and long-term investments.
Today I’m going to look at savings and ISA which is a simple technique to start off your savings and investments journey.
What I write on this website is not financial advice, I always encourage you to do your own further research. If you’re in doubt about anything, it’s worth consulting a regulated financial advisor who would provide suitable tailor-made advices that match your circumstances.
Which savings product is right for you?
Many banks offer Bonus Saver and it can be worth considering.
Positives:
- Interests paid monthly
- Higher earnings paid if no or few withdrawals are made
- Money easily accessible
- Great if you don’t need to make withdrawals for a long time
Negatives:
- Interests rate can go down
It’s easy to get lost among the different rates and products offered by banks, I’m writing a simple guidance.
-> Halifax 3.70% AER if you make less than 3 withdrawals
-> HSBC 4% AER if you make no withdrawals at all
-> Barclays 5.12% AER up to £5,000 and 1.16% AER above £5,000
-> Lloyds 3.80% AER if you make 3 or less withdrawals
-> Natwest 6.17% AER up to £5,000 and 1.60% AER over £5,000
I hope you find the saving products useful and have a better view of
What is a ISA?
It might sound complex to dive into the investment world but it’s extremly simple. Opening an ISA account is easy to do and might be your first step to dip toes into your investment journey.
An ISA account can be opened with your current bank or you could do your own research to find a separate ISA provider. The benefits to an ISA accounts are:
- Money grows tax free
- Invest up £20,000 each year
- Access your money anytime
A £2,000 deposit tracking world equity index a decade ago would have doubled in value. Not many saving accounts can match that.
Bear in mind that having an ISA account can incur potential costs. They’re totally dependent on your ISA provider and I encourage you to do your own research before going ahead.
Conclusion:
£15,000 sitting in a current account could be split into a saving account for £6,000 and £4,000 in world equity index through an ISA account.
If you have any questions about savings and ISA process leave me a note!
Thank you for reading this post and I hope you enjoyed it.
Cactus Personal Finance 
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