The first, and easiest thing to sort out is surely your cash holding.
Sort it out mate
I had been fairly guilty of leaving my savings in wack accounts that weren’t at the best rates. Even with £10k in savings, it can seem more hassle than it’s worth setting up new accounts to get an extra 0.5% in interest a year, or £50.
But the new Mr Zombie isn’t like that, oh hell no. Post apocalypse – this zombie is chasing all the best rates, as it all adds up in the long term right?
There are some pretty good deals on at the minute and you can get 5% on a current account (up to a £2.5k or £2k limit) or 6% on a regular saver.
Industrious, you are
So I’ve been busy setting up multiple current accounts, chasing the best rates and devising a magnificent flow chart to ensure that all the multiple accounts get their minimal monthly funding and then the money moves on to the next account. A bit of a ballache, but it means that my cash it protected from current inflation and my financial nugget is growing away.
It is free diversification from one bank I guess!
This article is still pretty relevant. With a couple of Nationwide current accounts and three TSB current accounts (one joint) you can have £11,000 earning 5% with instant access. Not too shabby for the times.
The early 2014 Mr Z would have been howling with laughter at me beavering away for a little extra return, still in 20 years he could be living in a skip while I will be riding a golden horse. Probably.
How much in cash
How much to keep in the ultimate liquid asset? For us, I think about £26k. £6k as an emergency fund and £20k as we want to move house in the next couple of years, Should be enough with equity release as well for Zombie Mansion Mk II.
It will mean leaving some in accounts earning about 3%, but that’s the price you pay for liquidity I guess.
It will take a few more months saving to get there.
In the mean time, we need to have a super sweet plan in place for the savings once the cash nugget is in place.
The super sweet plan
Peer 2 peer lending, bonds or a property fund?
I guess the point of my ramblings above, is you can get a real return on cash, in instant access accounts with a little bit of leg work. There is a risk that these rates could be cancelled tomorrow of course, as they are all discretionary. But then if that happens you just move onto the next account. You wouldn’t sit in your house while it crumbled around you, so why leave your cash in shoddy accounts. Ok, not quite the same, but you get the point.