Regular savings dilema

Shelle · 26 January 2007 at 7:09PM

Whats the best thing I can do?

I have enough savings to open more than one regular savings account. I have already decided to open a Lloyds TSB one (already had a current acc although not used as main one). Debating about opening a Halifax one at 7% for second one.

Alternative would be to do the Alliance and Leicester offer at 12% and transfer my current account to them in order to qualify. Is that a reasonable idea to do just to get 12% on £250 accrual a month for a year? My current account is with IF at present with a 3% interest rate so obviously my balance loses out slightly. Is the gain on the savings enough to warrant changing over? Considering the savings rate will be just for a year?

I suspect it may not be, and that I should stick with Lloyds TSB and Halifax without changing my current account. Am open to ideas though in case I have overlooked something!

Mikeyorks · 26 January 2007 at 8:35PM

The A&L is dubious as the Current Account you have to link to is poor. But rather than repeat what is already written - it is covered here :-

http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1151055096,42233,

.... and the main Reg Saver article has a link at the top of this thread :-

http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1108401263,93536,

.... there's also a discussion article linked to the above, you might want to read :-

http://forums.moneysavingexpert.com/showthread.html?p=2364776#post2364776

Personally I only use a Reg Saver where, for other reasons, I already have a current account with the provider. But you maximise your return if you hold the funds you're waiting to 'drip feed' into a Reg Saver - in a good rate savings account. Preferably with the same provider - in order you minimise interest loss caused by money in transit?

Kazza242 · 26 January 2007 at 8:59PM

Shelle - You don't have to transfer your current account to A&L to take advantage of the 12% regular saver offer. All you need to do is open the regular saver together with the Premier current account and then transfer £500 to the current account each month from your IF current account. £250 of which can then be transferred to the regular saver every month. Once you've chosen the monthly amount you wish to deposit into the regular saver you cannot alter it.

Yorkshire Building society offer an excellent regular saver, which will see it's rate increased to 7.00% from this Sunday. It allows you to pay in anything from £10 to £500 each month and allows you to continue saving until the balance reaches £20,000. You don't need to open a current account with them to take advantage of this offer. More details here.

Shelle · 26 January 2007 at 10:14PM

Is the yorkshire one an unlimited term one (ie until you reach 20,000 so if paying max 500, just over 3 years?)??? It says annually, but doesnt mention that account converts into whatever on anniversary, so wondered if that means it continues as regular saver??? Also I cannot see if you apply online or in branch?

As regards A&L, may well consider doing that as can keep my main account at IF and simply transfer 750 to a&l and then transfer 250 to a&l saver and 500 to yorkshire saver. Does that make sense and work? So despite having a low int rate on current acc, as I would only transfer in the amount needed to then transfer to the 2 savers, I am not really losing anything? Is that correct?????

YorkshireBoy · 26 January 2007 at 10:30PM

Shelle wrote:

It says annually, but doesnt mention that account converts into whatever on anniversary, so wondered if that means it continues as regular saver???

They say in their hard copy literature (supplied with your application pack) that they'll write to you when your balance reaches £20,000, letting you know what your options are.

Also I cannot see if you apply online or in branch?

Did you miss the How To Apply link?

As regards A&L, may well consider doing that as can keep my main account at IF and simply transfer 750 to a&l and then transfer 250 to a&l saver and 500 to yorkshire saver. Does that make sense and work?

I wouldn't operate that way. You're moving £250 of your YBS money through 2 transfers each month - and losing interest as a result. The way I'd run it is to send £500 to A&L (of which you'd then move £250 of this to YBS), and £250 directly to YBS - since you can make multiple deposits each month to YBS as long as you don't exceed £500 per month.

Kazza242 · 26 January 2007 at 10:33PM

Shelle wrote:

Is the yorkshire one an unlimited term one (ie until you reach 20,000 so if paying max 500, just over 3 years?)???

Yes, it is an unlimited term. You will receive the regular saver rate until the balance reaches £20,000. YBS allow one penalty free withdrawal per account year, which can be used to ensure that the balance stays below the £20,000 limit indefinitely.:D

Shelle wrote:

It says annually, but doesnt mention that account converts into whatever on anniversary, so wondered if that means it continues as regular saver??? Also I cannot see if you apply online or in branch?

The interest rate reverts to a lower rate once the maximum account balance has been reached.

Here is the link to the 'How to Apply' information.

Shelle wrote:

As regards A&L, may well consider doing that as can keep my main account at IF and simply transfer 750 to a&l and then transfer 250 to a&l saver and 500 to yorkshire saver. Does that make sense and work? So despite having a low int rate on current acc, as I would only transfer in the amount needed to then transfer to the 2 savers, I am not really losing anything? Is that correct?????

You don't need to transfer as much as £750 to the current account, why not transfer the minimum £500 per month and send £250 of it to the regular saver. You can then transfer the other £250 to another regular saver or back to IF. Or you could transfer the other £250 to the YBS regular saver and also transfer another £250 from IF to YBS too totalling the max £500 per month RS limit.

You're right as you are using the current account money to fund regular savers you aren't really losing anything as the money isn't staying in the current account for long.

Shelle · 26 January 2007 at 10:53PM

Got it :j

Hadnt thought it through and realised that didnt need to transfer 750, just need the minimum, and simply top up 250 to YBS from IF!

Considered transferring 250 back to IF, but then thought having a standing order of 250 to YBS would make it look more like a proper account (even though terms and conditions do not state that you have to use their current account as a main account), and doing this would shut them up!!??!!

What timing should I be doing re opening the accounts? I know I will need to allow time for the electronic transfers of monies from IF to A&L current acc, and then to the savers. Can I select dates or is it in accordance with opening date of current account?

Next step will be how to prove my identity! I have no utility bills, council tax, mobile phone contracts etc as I still live at home with parents (thanks to high mortgage payments - despite having plenty of savings I cannot get a big enough mortgage on salary!). I only have passport and paper driving licence. It seems even credit card and bank statements are no good when internet based!!! Will have to check in branch when I apply!

Many thanks to those who have answered. You have been really helpful :beer:

Kazza242 · 26 January 2007 at 11:15PM

Shelle wrote:

Got it :j
What timing should I be doing re opening the accounts? I know I will need to allow time for the electronic transfers of monies from IF to A&L current acc, and then to the savers. Can I select dates or is it in accordance with opening date of current account?

The A&L 12% regular saver will be withdrawn from the 7th February, so hurry. When you open your regular saver, the term doesn't start until you make your first payment into the account. When you open the A&L account you will be asked what amount and date you wish the standing order to go out. I would open them both as soon as you can, as these accounts can be withdrawn at any time and you don't want to miss out.

Shelle wrote:

Next step will be how to prove my identity! I have no utility bills, council tax, mobile phone contracts etc as I still live at home with parents (thanks to high mortgage payments - despite having plenty of savings I cannot get a big enough mortgage on salary!). I only have passport and paper driving licence. It seems even credit card and bank statements are no good when internet based!!! Will have to check in branch when I apply!

As you have a passport and paper driving licence one of them can be used as proof of name according to YBS's regular saver terms and conditions:

Proof of name: Passport, full driving licence, original and current notice of tax coding from HMRC (Inland Revenue).

Proof of address: Original bank or building society statement less than 3 months old, original utility bill, e.g. gas, electricity, telephone (not mobile) less than 3 months old, original and current council tax bill. Details of other acceptable forms of ID can be obtained by calling YBS on 0845 1200 100.

If possible visit a branch to open the account, as they will photocopy your ID there and then and open the account for you.

YorkshireBoy · 26 January 2007 at 11:24PM

Kazza242 wrote:

When you open the A&L account you will be asked what amount and date you wish the standing order to go out.

I seem to remember that A&L needed around 3-4 weeks notice (from account opening, not application) to set up the regular saver 1st direct transfer when I opened my account last year.

I applied towards the end of January last year, and my first regular saver transfer wasn't made until April (because I wanted it set for the 7th of the month, they said there wasn't enough time for them to get it set up for the 7th March - some 6 weeks after I applied :rolleyes: ).

Kazza242 · 26 January 2007 at 11:27PM

YorkshireBoy wrote:

I seem to remember that A&L needed around 3-4 weeks notice (from account opening, not application) to set up the regular saver 1st direct transfer when I opened my account last year.

I applied towards the end of January last year, and my first regular saver transfer wasn't made until April (because I wanted it set for the 7th of the month, they said there wasn't enough time for them to get it set up for the 7th March - some 6 weeks after I applied :rolleyes: ).

That's really slow. All accounts I've opened have allowed me to get the SO setup within days! Oh well, at least the term doesn't start until the first payment is made.

Regular savings dilema

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