Saving Money - Help!

[willprentice]

I have �5000 i want to save. I want to pay this into a savings account in one lump sum and make no further payments into the account. I will need access to the money in 4 year time.

Any recomendation of who to save with will be greatfully recieved.

Thanks in advance

[larakitten]

Hi there, you could look at a couple of options depending on your tax status. If you're a non tax payer, something like Halifax Guaranteed Reserve or Websaver (if you like internet banking) would suit well as the Gross rates are good. If you do pay tax, from the same company you could look at an ISA saver Direct, a telephone based isa offering 5%. No one pays tax on an Isa. You could put �3k in for this tax year, then in a couple of weeks at the start of the new tax year, your allowance renews and you could pop in the remaining �2k to get the whole amount into the one account.

Non of these accounts require regular payments to be made in, and all (with exception of the Guar Reserve) allow the money to be withdrawn if you did need access.

Hope this helps!

[BigMac]

Agree with larakitten - very sound advice. Assuming you are a taxpayer, take the ISA option.

[WendyS]

They say "Great Minds think alike" and I when I read your question, before I saw the first two responses I was going to suggest exactly the same.

Take out two cash ISAs, setting one up quickly for the maximum of �3000 before the end of this tax year which I think is around 3rd/4th April. Then open another one in the new tax year immediately afterwards. If you check on the internet under Best Cash ISA's you'll get a lot of suggestions. I believe Halifax is currently paying 5% tax free. If you want both transactions to appear in the same passbook, you can do this with Kent Reliance Building Society who are currently paying 4.86% tax free. If you want to catch this year's allowance you'll need to move quickly and have your passport or photo driving licence available for proving your identity and some documentation such as bank statement, utility bill to prove your address. (This is for money laundering regulations).

[stevie21]

Further to WendyS - the tax year runs from the 6th April to the 5th April as far as my memory goes.
Also, you won't need to open a new ISA after April, you'll simply be permitted to add up to an additional �3k to your existing ISA - taking the balance up to �5k.
Some ISAs have tiered interest rates so you may get x% on anything up to �2999 and then x.2% on �3k and above. An added bonus.

I'd look at moneyfacts.co.uk and also compare the return on an ISA to what you'd get from a bond. Remember that with a bond you may pay tax on the interest.
If it's advertised as 5% then you get 80% (or 4/5ths) of this after tax : 4% net.