The One account

Not a new comer to the One Account, but have had it for a few years. If you can be disciplined with your finances, it's fantastic. If you can't, it can be v.dangerous.

The flexibility is great...I operate mine notionally has having a loan (mortgage) for the house payable over the next 13 years, with a couple of shorter term car loans stacked on top of that. I have a spreadsheet that tells me, based on these loans, what my balance should be each month. Therefore, I can then look at the One Account balance, subtract the spreadsheet figure and get the "real" balance. The flexibility is really useful for "life events" as well; the missus is expecting so will go on maternity leave, so I can choose to defer paying the mortgage down for a year without having to grovel to the bank.

You will doubtless be told that you can get a better deal by continually taking out short term fixes as the interest rate on the One Account isn't competitive. This is true, but it misses the point that by having a current account mortage, overypaying "just happens". E.g., if you conventionally would need to pay £500/month for your mortgage, your take home pay is £2000 and you only actually spend £1300 a month on other things, then you automatically overpay your mortgage by £200 without having to make a conscious decision to do so. As such, you can dramatically shorten your repayment period (so far I've cut 8 years off mine). Danger, though...in the above example if you spend £1600, you'll conversely underpay your mortgage and no-one's going to hold your hand to tell you.

You might want to consider rejigging some of your other finances to suit the new paradigm;

1) Any investments you have which don't pay at least 5.7% (or whatever rate you're on) *NET OF TAX* should be binned, because you're better off paying the money to reduce the balance on your One Account.

2) As your salary is reducing the balance as soon as it's paid in and your balance gradually drifts up over the month, try to get direct debits rescheduled to the back end of the month.

3) Get as many credit cards that charge 0% interest (or, for that matter, lower than 5.7%/yr) as you can, and put all your expenditure on them - you'll be saving yourself from the interest accruing on the One Account.

One final thing; cheques are pretty much a thing of the past, but if you do need to pay them in, go to a branch of RBS rather than relying on putting them in the post to Norwich - you'll find they credit your account a LOT more quickly.