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  • FIRST POST
    • daveoc22
    • By daveoc22 14th Nov 12, 11:03 AM
    • 205Posts
    • 42Thanks
    daveoc22
    Santander123 As A Savings Account?
    • #1
    • 14th Nov 12, 11:03 AM
    Santander123 As A Savings Account? 14th Nov 12 at 11:03 AM
    Given the low rates on easy access accounts I've been thinking of converting our Santander current account to a 123 account.

    As I understand it we can get interest of 3%, paid monthly, on credit balance up to £20000, with a £2 a month charge.3% seems pretty good at the moment.

    The only problem is we don't use this account for direct debits and I think you are supposed to have two direct debits set up on it.

    Anyone any experience of opening one without having any direct debits?.
    Waddle you do eh?
Page 1
    • Gromitt
    • By Gromitt 14th Nov 12, 11:08 AM
    • 4,971 Posts
    • 2,378 Thanks
    Gromitt
    • #2
    • 14th Nov 12, 11:08 AM
    • #2
    • 14th Nov 12, 11:08 AM
    You can use a savings account for direct debits. For example, if you open a Tesco internet saver and a Tesco instant access saver, you can transfer £1/month to them and satisfy the requirement. One a year, you can transfer that £24 back to your current account (or sooner if you want).

    You will need to pass £500/month through the account to get the interest.
  • Cass85
    • #3
    • 14th Nov 12, 2:00 PM
    • #3
    • 14th Nov 12, 2:00 PM
    You must have at least 2 direct debits and £500 credited each month to qualify.

    Otherwise youre paying £2 a month and wont get interest.

    Also remember as it is a bank account a credit search is carried out.
    • Gromitt
    • By Gromitt 14th Nov 12, 2:06 PM
    • 4,971 Posts
    • 2,378 Thanks
    Gromitt
    • #4
    • 14th Nov 12, 2:06 PM
    • #4
    • 14th Nov 12, 2:06 PM
    You must have at least 2 direct debits and £500 credited each month to qualify.

    Otherwise youre paying £2 a month and wont get interest.

    Also remember as it is a bank account a credit search is carried out.
    Originally posted by Cass85
    You forgot the "Minimum £1000" qualifier and it's basically the same post as I made 3 hours ago
  • Cass85
    • #5
    • 14th Nov 12, 2:14 PM
    • #5
    • 14th Nov 12, 2:14 PM
    You forgot the "Minimum £1000" qualifier and it's basically the same post as I made 3 hours ago
    Originally posted by Gromitt
    Ah im full of assumptions today. I assumed if you were putting savings in there you were putting the £20k in.
    • notbritishgas
    • By notbritishgas 14th Nov 12, 3:41 PM
    • 1,955 Posts
    • 848 Thanks
    notbritishgas
    • #6
    • 14th Nov 12, 3:41 PM
    • #6
    • 14th Nov 12, 3:41 PM
    Yes OP I am thinking of doing the same.
    I have a Premier direct current account and an esaver 4 that has just reverted to 0.5% interest!
    If I convert my CA to a 123 account and move £15000 into it from the esaver together with the DD's in there and the balance of about £2500 I would get about£515 annually.

    I am hesitating because I wonder about Sanatander's motives, are they trying to get people onto a fee paying account and then gradually reduce the rewards or increase the fee. I know I could change banks if they do that but really do not want the hassle of changing 13 DD's.

    I have just opened a Nationwide account paying 2.6% (mainly for the esaver4 cash) so would only gain 0.4%.
    Last edited by notbritishgas; 14-11-2012 at 3:45 PM.
    • psychic teabag
    • By psychic teabag 14th Nov 12, 4:39 PM
    • 2,442 Posts
    • 1,455 Thanks
    psychic teabag
    • #7
    • 14th Nov 12, 4:39 PM
    • #7
    • 14th Nov 12, 4:39 PM
    The only problem is we don't use this account for direct debits and I think you are supposed to have two direct debits set up on it.
    Originally posted by daveoc22
    Any particular reason not to move the "best" D/Ds over to get the cashback. For me, cashback from fuel plus water D/D's cover the fee between them, and the cashback from council tax is just about the same again. So even if you don't want to move all your D/Ds, just picking a couple of good'uns could satisfy the account conditions and the fee.
    • badger09
    • By badger09 14th Nov 12, 5:09 PM
    • 3,892 Posts
    • 3,145 Thanks
    badger09
    • #8
    • 14th Nov 12, 5:09 PM
    • #8
    • 14th Nov 12, 5:09 PM
    However I have the account, and currently £4k in their variable rate ISA @ 3.3%. If I cant find a better rate when the year is up I will certainly just switch this into 123.
    Originally posted by Strumminalong
    And lose its tax free status?
    • ses6jwg
    • By ses6jwg 14th Nov 12, 6:05 PM
    • 5,154 Posts
    • 5,805 Thanks
    ses6jwg
    • #9
    • 14th Nov 12, 6:05 PM
    • #9
    • 14th Nov 12, 6:05 PM
    The "motives" as far as I am aware is that Santander want to grow their banking liabilities (the amount held in bank accounts) and overall stock numbers (number of active current accounts).

    From my experience if you can manage to put a few thousand in both accounts whilst it's taking place then the account transfer service are very very good. I've done quite a few this year and had no problems at all. The problems arise when people don't put enough money in the account to cover their DD's.

    If you don't want to move them all just put 2 on there. The most popular ones are Sky and home/ mobile phones as everyone moans about how expensive they are and you get 3% off.
  • Strumminalong
    And lose its tax free status?
    Originally posted by badger09

    True, but I'm not sure that would work out a great deal better than interest less tax on the 123 account, when compared with other easy access ISA's that are likely to be around next summer.

    Will certainly look around, but this is my emergency fund, and I dont really want to tie it up.
    Annuity loan matures - Collect £100.
    • daveoc22
    • By daveoc22 15th Nov 12, 9:50 AM
    • 205 Posts
    • 42 Thanks
    daveoc22
    Thanks for all the replies folks.

    It seems to make sense, though, giving all that is happening with other accounts, i fear the 3% rate may not last a lot longer.
    Waddle you do eh?
  • mjjp2
    Beware of Mis-selling Santander123
    I was buttonholed by a sales person during a visit to the local Santander branch. The 3% interest rate was better than any other rate available and she persuaded me to open an account. I said it seemed so good that I could transfer all my savings into the account. She didn't warn me about the £20000 limit. When my 12-month ISA bonus rate expired I put all my retirement savings into the 123 account, but discovered 6 months later from a TV ad that I'd lost all the interest on the retirement savings over 20k that I'd put into the 123 account. I'm a pensioner, already draining away my life-savings through inflation. When I complained to Santander they accepted that I was telling the truth (I do have a witness) but dismissed my claim for compensation on the basis that I should have read the small print. So much for taking responsibility for mis-selling and verbal aspect of the contract I signed. Beware of deceptive and misleading sales staff in Santander branches! I've been advised by various people to keep complaining and also to go to the Banking Ombudsman. I will.
    Last edited by mjjp2; 22-02-2014 at 2:24 PM. Reason: spelling error
    • eskbanker
    • By eskbanker 22nd Feb 14, 2:48 PM
    • 3,087 Posts
    • 2,729 Thanks
    eskbanker
    You can have two 123s per person so can get interest on up to £40K in total provided you satisfy all the other terms (DDs, funding, etc). You might be able to convince Santander to make a payment equivalent to a second £20K's worth of interest - the £20K limit is fairly well publicised in the product documentation though (rather than having to wade through the really small print), so I can see where they're coming from about your responsibilities to read about what you're signing up to.
    • Archi Bald
    • By Archi Bald 22nd Feb 14, 3:48 PM
    • 9,198 Posts
    • 7,180 Thanks
    Archi Bald
    .....but discovered 6 months later from a TV ad that I'd lost all the interest on the retirement savings over 20k
    Originally posted by mjjp2
    Sorry, no sympathy from me.

    Are you seriously suggesting that you did not check your current account, with all your retirement savings in it, not once in 6 months? If you did check it, why did you not notice that you did not get 3% on everything?

    It's a pretty sad state of the nation if even people with a whole lifetime of experience don't feel responsible for their own actions.
    • Imnoexpert
    • By Imnoexpert 22nd Feb 14, 4:16 PM
    • 263 Posts
    • 117 Thanks
    Imnoexpert
    I have some sympathy
    I don't want to comment about this case specifically as I don't know the poster, or the full facts of the situation.

    I do think though that anyone selling financial services has responsibilities - moral, ethical, and regulatory which differ from other selling situations. I oversaw my own late mother's affairs in her retirement and to her the people in the Building Society (her building society as she thought of it and as the advertisers reinforced) as friends. I recall her horror when I described them as sales people and she corrected me saying that banks didn't sell things they were advisers - giving advice. My mum was no fool - but a product of her generation, and was not well educated or informed.

    I have a 123 account which I opened online recently and it isn't a simple product. I was aware of the rules - though if I'm honest I am awaiting my first interest payment to confirm that I have set it up ok and that the 2 direct debits are acceptable to them and that the £500 transfer went in on time. I must say for example I hadn't appreciated I could have two 123 accounts at first though but as I wasn't looking to do that I probably didn't notice. As an online buyer I accept that my situation differs from someone receiving "advice".

    There are lots of people who don't find money management interesting, or easy to understand. Look up the facts on the numbers of people who don't understand simple percentages for example.

    I am not a particularly kind/sensitive person and I have spent a career in sales but if I felt I had sold a pensioner an unsuitable product which they hadn't fully understood I should find sleeping at night quite difficult! I hope Santander feel the same.
    • ColdIron
    • By ColdIron 22nd Feb 14, 4:36 PM
    • 2,365 Posts
    • 2,593 Thanks
    ColdIron
    Without wishing to be uncharitable the £20,000 limit has always been clearly stated on any material I have ever seen. As mentioned, they even say it on the telly

    Salesmen do not act in loco parentis and to expect them to do so is somewhat naive

    Ultimately we are all responsible for our own money and don't forget that we all sign a declaration that we have read and understood the Terms and Conditions
    Last edited by ColdIron; 22-02-2014 at 5:00 PM.
  • B1gAl
    I was thinking about moving my ISA savings into this account because i am getting a lot less interest on the savings in my ISA (about 12k) surely I would be better off getting a decent interest rate than a rubbish one tax free? I didn't know i had to have 2 direct debits though so thanks for pointing that out!
  • B1gAl
    The best easy access ISA interest rate is 1.75!!
    • Archi Bald
    • By Archi Bald 22nd Feb 14, 5:38 PM
    • 9,198 Posts
    • 7,180 Thanks
    Archi Bald
    Ultimately we are all responsible for our own money and don't forget that we all sign a declaration that we have read and understood the Terms and Conditions
    Originally posted by ColdIron
    I agree entirely. If somebody feels uneasy about T&Cs, or generally handling their finances, they should be asking for help from a family member or friend, or the CAB, or even an online forum like MSE. Plenty of written information available, plenty of places to go to, and not doing anything pro-active for 6 months to check the transactions on a current account is pretty much unforgiveable.

    Imnoexpert - the selling of a current account does not constitute "advice" in financial terms. All the 123 literature and website has always been abundantly clear on the interest. There is even a calculator on the Santander website that allows people to calculate what they should be expecting in terms of interest (and cashback). The OP did state that they understood the TV ad, so there's a fair chance that they would also have understood the 123 leaflets and the 123 website if only they had tried.

    Of course it is annoying not to have received interest for 6 months, but the OP has, IMO, only got themselves to blame for it.
    • Archi Bald
    • By Archi Bald 22nd Feb 14, 5:42 PM
    • 9,198 Posts
    • 7,180 Thanks
    Archi Bald
    I was thinking about moving my ISA savings into this account because i am getting a lot less interest on the savings in my ISA (about 12k) surely I would be better off getting a decent interest rate than a rubbish one tax free? I didn't know i had to have 2 direct debits though so thanks for pointing that out!
    Originally posted by B1gAl
    You also need to pay in £500 each month, otherwise you get no interest. And the account costs £2/mth. Perhaps read up about the account on the Santander website?

    Whether it is better for you to have the money in a current account with a variable rate instead of in an ISA only you can tell. Once you take your money out of the ISA, you lost the tax-free wrapper on it for good. To get £12K back into a cash ISA will take you at least 2 tax years.

    If you are planning on spending the money in the next couple of years or so, though, you might as well chance it with a current account.
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