Temporary influx of cash – suggestions on how to manage

[MattB]

My wife’s house sale has gone through and whilst the plan is to also sell mine and pool our resources there isn’t anything out there at the moment for us and so we have ~£130k needing a home.

I’m hoping it wont take us too long to find somewhere, so don’t see the point locking it into some sort of investment & she doesn’t want any risk anyway. We have 95k of premium bond space so was was thinking to put the majority in there (utilising curve and V+ where possible) and pay off a chunk of my mortgage with the rest.

Does this seem a sensible approach or am I missing something?

• This topic was modified 54 years, 11 months ago by .

[PeteM]

I think the Chase saver account is the highest-earning easy-access savings account at the moment at 1.5% AER, a good chunk better than Premium Bonds.

[Aquarius12]

Do not forget the UK bank protection limit of £85,000 when depositing funds in U.K. bank.

• This reply was modified 54 years, 11 months ago by .

[aseftel]

Aquarius12 wrote:

Do not forget the UK bank protection limit of £85,000 when depositing funds in U.K. bank.

Actually you can forget about it, for six months at least: https://www.fscs.org.uk/making-a-claim/claims-process/temporary-high-balances/

[BuildBackBetter]

If you don’t plan to use it in the medium term -(2 to 4 years), invest in funds like VLS 40 or trust like CGT.

[Toppcat]

I would do exactly what you are suggesting for a short-term holding. Premium bonds prizes are tax free, and the PB rate of ~1% plus whatever rewards you manage to generate by funding via curve (V+ sounds good) will likely outweigh any interest you could get elsewhere.

[The Savage Squirrel]

Toppcat is right; tax free return + funding “benefits” of PBs will likely outstrip anything else for a tioe period measured in months.

Maybe not so relevant if you’re about to sell your own property, but as a general rule, never ever pay off a chunk of your mortgage – always pay that amount into on offset facility instead if available (and ask your lender for one even if it’s not advertised as a feature of your mortgage product – they’ll sometimes still set one up for you). You then have the same net result but as a secondary benefit, can think of the contents of your offset account as an instant access zero paperwork credit facility. You may never need it, but as life tends to throw up the unexpected, you never know when that might be useful.

• This reply was modified 54 years, 11 months ago by .

[MattB]

Thanks for the comments, I’m really hoping it will be only be for 6-9 months max so will stick to PBs.

[Andrew.]

The Savage Squirrel wrote:

Toppcat is right; tax free return + funding “benefits” of PBs will likely outstrip anything else for a tioe period measured in months.

Maybe not so relevant if you’re about to sell your own property, but as a general rule, never ever pay off a chunk of your mortgage – always pay that amount into on offset facility instead if available (and ask your lender for one even if it’s not advertised as a feature of your mortgage product – they’ll sometimes still set one up for you). You then have the same net result but as a secondary benefit, can think of the contents of your offset account as an instant access zero paperwork credit facility. You may never need it, but as life tends to throw up the unexpected, you never know when that might be useful.

Depends if your former employer, with whom you held a mortgage, has demanded you sign an NDA (with threatening recovery content) along with your redundancy payment.

In which case I paid it off in full to ensure that they didn’t have a charge over my home.

(Obviously I edited the PDF and amended/deleted certain paragraphs, without drawing their attention to it, before printing and signing.)

[Nomad]

Curve metal is requested to fund PB via it (and VA+), right?

[MattB]

I believe so yes, and looks like you have have a minimum 6 month term at £14.99 per month.