Apr

14

emergency funds are no fun

Filed Under savings | 22 Comments

swingingAn emergency fund is the least fun, most boringly sensible thing you can do with your money. Saving up for things is great, because you get things that you want in return. Investing for retirement is great, because you get to be rich in return. Even paying off debt is great, because eventually you’ll be out of debt (which is supposed to be a great feeling) and it probably means that you overspent at some point, so you’ve enjoyed all that stuff even if you did pay too much for it.

When you put money into an emergency fund, it needs to be an accessible place, so it doesn’t even compound that much. You squirrel away a whole load of money, at least the equivalent of several months expenses and plan never to spend it. Where’s the fun in that? There isn’t any fun in it, that’s where.

Thing is, if you need an emergency fund, it’s because you are a grown up. Sure, being a grown up means having fun, but it also means accepting that sometimes you need to be sensible, and then it means getting on and doing it. No fun, no messing and no spoonful of sugar.

On the bright side, once the emergency fund is in place, you don’t have to think about it too much, it’ll help you sleep at night, and you can get on with playing on your Wii, or whatever else it is that grown ups do.

Mar

31

don’t forget to use your ISA allowances

Filed Under investment, savings | 2 Comments

If you have more money to put in your ISAs for the 2007-08 financial year, you have until 5th April to do so.

The allowed amounts are up to £3000 in a mini cash ISA, up to £4000 in a mini stocks and shares ISA, and up to £7000 in a maxi ISA (basically stocks and shares).

Feb

7

have you used your 2007-08 ISA allowance yet?

Filed Under investment, savings | 7 Comments

So, now we’re into February and there’s only two months to go until the end of the tax year on 5th April. Which begs the question “have you used your ISA allowance yet?” and if not, how are you planning to do so?

what is an ISA?

Basically, it’s a tax-free wrapper for either or both of savings or investments. Every year you get an allowance to use up. In 2007-08 you have a combined limit of £7,000 of whuch you can put up to £3,000 into savings - the rest can be placed into investments.

what do I need to do to use my ISA allowance?

Open some accounts and put some money into them. It’s no harder to open an ISA than it is to open any other bank account. It’s easier to open one now than wait until right before the deadline.

Look at your whole financial situation. Have you got any money in savings that can be put into a cash ISA instead? Think about the money you’ve got coming in over the next couple of month, can you use any of that to fund it? Think now about how to get together as much money as possible, ISA allowances are use it or lose it deals.

where should I open one?

If you’re looking for a cash ISA, the current best buy according to moneysavingexpert.com is the Icesave one which pays 6.1% interest, and has a minimum balance of £1000. If you’ve got less to put away, the next best is from Egg, paying 6.05% interest and has a minimum balance of £1.

If you’re looking for a stocks and shares ISA, really you need to have an investment plan and then find the cheapest way of doing what you want from that. Usually, a funds supermarket ISA will have the biggest discount on funds costs, the ones that I’ve heard people using are Fidelity and Hargreaves Lansdown but I’m sure there are others, do your own research.

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