Hi,
I have a little bit of savings: 40K. As this is cash and I have an account in Ireland would it be worth moving my money? What is the best thing to do with cash? NSandI looks like a pile of pants. The BOE are likely to drop rates again which will make returns on savings accounts go down too. It's looking like the BOE care more about people with debits than people that try to save. And yes, I know 40K is nothing compared to house prices, but it's hard to save :-)

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Suggest you go to moneyweek.co.uk and read some of the Editor's articles and also their articles on savings.

Welcome to the club of people who work hard and save but who are being screwed by global capitalism for doing so.

If you're a higher rate taxpayer, the tax free NS&I Index-Linked certificates are actually extremely good. Assuming RPI stays at 4.0% over the next 12 months (and Merv suggested today that inflation will likely increase in the near future) you could invest 15K in the 3 year certs, with interest of (4.0+1.1 =) 5.1% in year 1 and 15K in the 5year certs with interest of (4.0+0.95 =) 4.95% in year 1.

Taking the average over the whole 30K of 5.025% for the first year, once tax is taken into account, the effective rate for a higher rate taxpayer is around 8.4 % and for standard rate taxpayers around 6.3%, factoring in the change to basic rate tax in April.

While the return isn't outstanding for standard rate taxpayers it's not bad, and assuming RPI doesn't fall (which of course it might), the return for higher rate taxpayers is pretty much unbeatable at the moment.

If you haven't used your ISA allowance for this year, again the NS&I rate isn't bad at 6.05% and (like all ISAs) is tax-free. Once you've stuffed 3K in that or any other cash ISA. That just leaves 7K to worry about.



Edit: Forgot to mention I was referring to NS&I accounts. Doh! Also updated because RPI was 4.0 in December and not 4.1 as I originally stated.