Trying to work through the best course of action after a property settlement in a few weeks.
After existing mortgages are paid out we will be left with a bit over $1m in cash. The plan is to purchase another property in about 4 months. We have no other mortgages that we could use this as an offset against.
We're looking at HISAs and there are a couple of options:
- Putting the bulk of it in something like a Macquarie Savings Account. This has a 4 month honeymoon rate of 5.4% for up to $250k. I can't find info on the honeymoon rate for balances over $250k, or it the honeymoon applies to the first $250k only
- Split the balance over multiple vendors to take advantage of honeymoon rates.
We're not particularly concerned about the deposit guarantee.
Over that short a period, the difference between making use of honeymoon rates would seem to be getting ~5.2 (average) and 4.5% interest, which is probably about $2.5k.
This doesn't seem worth it to me for the extra set up, but I would like to hear others' thoughts, and if there's any other options that would make sense over this time period, aside from the obvious of investing in multiple AMG Mercedes, crypto, gourd futures etc.
Make sure you put some of that interest earned aside for tax.
Also put it in an account name for the lowest income earner adult.