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[MSE Dan]

This thread is specifically to discuss the

Regular Savings Accounts article

which includes new calculator to work out the interest

To discuss or ask a question about this article, click reply

[D.A.]

My wife already has a Halifax Regular Saver account. I'm wondering if the 10% rate only applies to new customers, or existing ones?

[miss_jc]

I am currently looking for mortgages to buy my first home.

What do people think about opting for an interest only mortgage - let's say with a fixed rate of 6.5% for 2 years and saving regularly with the halifax regular savings earning 10% and repaying the sum saved at the end of the fixed term?

Sorry if this seems a silly question. I am new to this 'working out finances' thing and while it seems to make sense to me no-one else seems quite convinced. It would also give me a degree of flexibility as I start off...

Thoughts greatly appreciated!!

miss_jc

[fagun]

The artricle has a small mistake regarding the Halifax RS account. The Guaranteed Saver Reward can be a nominated account and pays 6.25%, with one withdrawal allowed during the year. Compared to 7.01% fixed term deposit, you're just over £20 better off if you're saving the full £500 / month.

[Paul_Grist]

Hi, I note in this section that you say don't bother with HSBC, but for those who already have a plus account (such as I with a Graduate plus account) it negates the monthly fees if your overdraft is reinvested in the reg saver account.

A quick calc allowed for 1225 deposit in the first month and £25 thereafter (totalling £1500 - the usual size overdraft) giving £135 pretax, whereas the fee for this type of account is £9.95 per month.

So by using your overdraft for this purpose you gain the services offered on the plus account as well as £15!! or post tax it costs around £10 for the year, which is a darn sight better.

Not that I can do this, as I was pretty heavily into my overdraft after uni :-(

[kamari]

Interesting to hear about the new 10% regular saver account from Halifax. I currently have a regular saver with them, at 7% interest. I phoned them today to ask if the new 10% rate would apply to it and was told it would not, I would have to close it and open a new one. If I did that I would lose interest for the 6 months I have already saved. So not a particularly good deal for me and probably others!

[Milarky]

Originally Posted by kamari

Interesting to hear about the new 10% regular saver account from Halifax. I currently have a regular saver with them, at 7% interest. I phoned them today to ask if the new 10% rate would apply to it and was told it would not, I would have to close it and open a new one. If I did that I would lose interest for the 6 months I have already saved. So not a particularly good deal for me and probably others!

Psst! Could you get a relative to open one in their name and you fund it? (If that were an option then you could drop your existing account sub to £25 and put as much as you can afford regularly toward the 10% account)

[MSE Dan]

Originally Posted by Paul_Grist

Hi, I note in this section that you say don't bother with HSBC, but for those who already have a plus account (such as I with a Graduate plus account) it negates the monthly fees if your overdraft is reinvested in the reg saver account.

A quick calc allowed for 1225 deposit in the first month and £25 thereafter (totalling £1500 - the usual size overdraft) giving £135 pretax, whereas the fee for this type of account is £9.95 per month.

So by using your overdraft for this purpose you gain the services offered on the plus account as well as £15!! or post tax it costs around £10 for the year, which is a darn sight better.

Not that I can do this, as I was pretty heavily into my overdraft after uni :-(

Hi Paul,

I dont think this works in the way that you say, as you can only deposit a maximum of £250 a month, so the lump moved in the first month wouldnt be possible.

But you are right in a way; we include the HSBC account purely because if you do not want to leave its current account at all, it is one way to claw something back. We just don't want anyone to get one of the expensive HSBC bank accounts if they dont already!

Dan

[ibrooks]

Is there a step by step guide somewhere to calculating what the interest would be over 12 months for a given AER?

Basically I'm looking at this new Halifax regular saver and trying to work out what my numbers would be - but..... I can't use the calculator as I'm planning to do the drip-feed but not quite the way you've described.

Say I had £3k - I can't shove it all in there on day one but I can deposit it at a rate of £500 per month for the first 6 months. That way I've got as much money in there as possible for as long as possible. Now for the remaining 6 months I drop back to whatever I can afford from my monthly budget but making sure I stay above the £25 minimum. So I'll know my running total for what I've paid in but how would the 10% AER be calculated over the 12 months? The half it rule of thumb would presumably be low because the final amount paid in is weighted towards the beginning of the year.

[Lavendyr]

Yes, the calculator linked to in the OP will help you.

[Paul_Herring]

Originally Posted by ibrooks

Is there a step by step guide somewhere to calculating what the interest would be over 12 months for a given AER?

If you want the step by step method/proof rather than just taking any calculators on trust...

£x - the amount deposited per month
y% - the Gross/AER (This assumes interest paid yearly.)

In the first month, you deposit £x, and it acquires 1/12th of y% interest - £x * y%/12
In the second month, you deposit another £x, and the £2x gets another 1/12th of y% interest - £2x * y%/12
In the third month deposit another £x resulting in £3x * y%/12 interest for the month
In the fourth month ... etc.

So for the full year you have interest of (£x + £2x + £3x+... + £12x)* y%/12

1+2+3...+12 = 78 So

Interest = £78x * y%/12 or simplifying (multiply both by 12)
Interest = £6.5x * y%

So the quick calculation is to take your monthly deposit, multiply by 6.5 and apply the AER interest to the result. Don't forget to apply income tax at your marginal (top) rate before using the result.

[nzseries1]

I just opened my Halifax 10% Regular Saver online right now (I already had a Halifax Credit Card so I could apply online).

Account was opened in less than 60 seconds, and my first bank transfer from HSBC took less than 2 minutes to appear in my new account! I had a new account with cash in it in just a few minutes, without leaving my computer and without having to send in any ID! The most simple account opening I've ever had.

Elsewhere on the boards people complain about Halifax's bad customer service. Let's hope I never find out about it the hard way.

Thanks moneysavingexpert.com! Shame there was no link I could use that helped the site

[nzseries1]

Can anyone tell me, for the halifax regular saver, what is "a month" exactly? I opened my account today (June 12) and put in my £500 - when can I next put in £500? Would it be July 1, or July 12?

I looked on the Halifax website but it's not clear. It seems to suggest "a month" is a calendar month. But if that were true, technically I could put in 13 payments of £500.

[Paul_Herring]

Originally Posted by nzseries1

Can anyone tell me, for the halifax regular saver, what is "a month" exactly?

From the T&C's, a 'month' is a contiguous period starting on the 1st and ending on the 28th of any calendar month.

Exactly one payment must be made at any time in each 'month' for the duration of the RS.

I opened my account today (June 12) and put in my £500 - when can I next put in £500? Would it be July 1, or July 12?

You can put your second lot in on the 1st July. Or the 2nd. Or anytime such that it arrives at Halifax by the 28th.

[nzseries1]

Originally Posted by Paul_Herring

From the T&C's, a 'month' is a contiguous period starting on the 1st and ending on the 28th of any calendar month.

Thanks so much. I figured it would be in the T&C's, but blind old me couldn't find them anywhere!

[ctdctd]

Originally Posted by nzseries1

Can anyone tell me, for the halifax regular saver, what is "a month" exactly? I opened my account today (June 12) and put in my £500 - when can I next put in £500? Would it be July 1, or July 12?

I looked on the Halifax website but it's not clear. It seems to suggest "a month" is a calendar month. But if that were true, technically I could put in 13 payments of £500.

July 1st - cos this is how mine was set up by the Halifax

[ctdctd]

Originally Posted by ctdctd

July 1st - cos this is how mine was set up by the Halifax

Whoops - seems to be a lag in the Internet - Paul's earlier reply wasn't there when I replied as well!

[Crinz]

Originally Posted by D.A.

My wife already has a Halifax Regular Saver account. I'm wondering if the 10% rate only applies to new customers, or existing ones?

i work for hbos (no abuse please lol). if your wifes regular saver has already started then it will be on the previous rate (i think 7%). if it is due to mature at any point in the next month or so then she will get the 10% rate for the year when she renews

the rate is fixed when you take this type of account so it isnt changed if you are part way through your year

hope this helps

[Paul_Herring]

Originally Posted by Crinz

i work for hbos. if your wifes regular saver has already started then it will be on the previous rate (i think 7%). if it is due to mature at any point in the next month or so then she will get the 10% rate for the year when she renews

'month or so'?

So those maturing 7% accounts maturing in the period that 10% are being offered will automatically be upgraded to 10%?

May I point you in the general direction of the 6% LTSB Current Plus thread? (Where existing Current Plus holders getting 4% don't get the 6% unless they specifically apply.)

the rate is fixed when you take this type of account so it isnt changed if you are part way through your year

Covered earlier in the thread. One post pointed out that even if your 7% expired the day after the 10% closed, you'd be better off closing the 7% to get the 10% if you could afford the £500 per month.

hope this helps

Not really. An online reference to T&C's confirming your first statement would be useful though....

Given your vague statements I'm guessing that you are either customer facing staff who hasn't been told what the T&C's are but just a general 'we're doing this 10% thing - here's how it sort of works' or not real an HBOS employee stirring.

[Crinz]

whats the point in coming here to try help. never again!

Yes, I am front-line staff working in a branch in Glasgow but i take offence at you incinuating that i know nothing about what I am writing about.

When this launched the other day we had loads of people coming in asking about their existing Regular Savings. Some I closed down and restarted as they matured and restarted just weeks ago, and some were just about to end and would automatically convert to the 10% rate.

http://www.halifax.co.uk/savings/regularsaver.asp

quote: When the year’s up, your savings and interest are transferred into a nominated savings account which you'll be asked to open when you open you Halifax Regular Saver. Your Regular Saver account remains open, the interest rate applicable at the time is fixed for another year and you simply continue to save.


when i said 'month or so' - at the moment the plan is for this promotion to be on display in branch etc until End July but as with other banks, it can be withdrawn at any time.


again, thanks for the warm welcome.