What do I do if the Santander rate drops?

Options
chelseablue
chelseablue Posts: 3,303 Forumite
Name Dropper First Post First Anniversary
in Savings & investments
I currently have £21,000 in an ISA but Im tempted to open the Santander 123 account and putting £20k in it so I can get the 3% interest before tax.

I have £16,000 in another account so could open an ISA as well for 2015/2016 and max it straight away,

BUT if the Santander 123 rate drops dramatically what do I do with the £20k if Ive already maxed an ISA?

HELP! :o

Comments

  • jimjames
    jimjames Posts: 17,619 Forumite
    Photogenic Name Dropper First Anniversary First Post
    Options
    If it drops then put the money in other accounts paying the best rate.

    Seems unlikely that it will drop massively very soon - when are you using the money to buy a house?
    Remember the saying: if it looks too good to be true it almost certainly is.
  • eskbanker
    eskbanker Posts: 31,034 Forumite
    First Anniversary Name Dropper Photogenic First Post
    Options
    There are plenty of other interest-paying current accounts that you could park your money in, albeit you'd need more of them as the others all have lower caps than Santander's £20K. While the 3% interest rate on a 123 is variable, it is also a key part of the 1-2-3 marketing message of the product and so it's less likely to change than many other variable rate accounts, in my humble opinion....
  • chelseablue
    chelseablue Posts: 3,303 Forumite
    Name Dropper First Post First Anniversary
    Options
    jimjames wrote: »
    If it drops then put the money in other accounts paying the best rate.

    Seems unlikely that it will drop massively very soon - when are you using the money to buy a house?

    Not for about 4 years roughly
  • gkerr4
    gkerr4 Posts: 495 Forumite
    Options
    i agree with above about it being integral to the "1-2-3" marketing - i think if they were going to do anything they would reduce the value on which the 3% is paid - maybe down to 15k for example.

    there must be a few people (myself included) who have 'maxed' out one or two or even three of these, but we are probably the minority - the 'main body' of 1-2-3 users probably don't do this so i doubt it is costing santander a fortune.
  • chelseablue
    chelseablue Posts: 3,303 Forumite
    Name Dropper First Post First Anniversary
    Options
    The £500 that you need to pay in monthly, can I transfer this over from Halifax and transfer it back straight away? Or does it need to stay in the account a while?
  • ColdIron
    ColdIron Posts: 9,049 Forumite
    First Anniversary Name Dropper Photogenic First Post
    Options
    In and out in the shake of a nanny goat's tail
  • YorkshireBoy
    YorkshireBoy Posts: 31,541 Forumite
    Name Dropper First Post First Anniversary
    Options
    chelseablue wrote: »
    The £500 that you need to pay in monthly, can I transfer this over from Halifax and transfer it back straight away? Or does it need to stay in the account a while?
    This question gets asked many times on here...quite unnecessarily when you think about it...


    If the £500 was your salary, you'd be pretty annoyed if they said you couldn't spend it for x days wouldn't you? Ergo, it doesn't need to stay in the account.


    And even if they marked the notes, you'd transfer out first then back in again. That'd throw them off the scent! ;)
  • Eco_Miser
    Eco_Miser Posts: 4,708 Forumite
    Name Dropper First Post First Anniversary Combo Breaker
    Options
    chelseablue wrote: »
    I currently have £21,000 in an ISA but Im tempted to open the Santander 123 account and putting £20k in it so I can get the 3% interest before tax.

    I have £16,000 in another account so could open an ISA as well for 2015/2016 and max it straight away

    Are you suggesting closing one ISA, and putting the money in Santander, then opening another ISA with some other money?

    Why not open the Santander with that £16k other money, plus £4k from the ISA, that way you'd still have you allowance available for later in the year.
    Eco Miser
    Saving money for well over half a century
  • chelseablue
    chelseablue Posts: 3,303 Forumite
    Name Dropper First Post First Anniversary
    Options
    Thank you all, I've just applied and been accepted :)

    Eco Miser; thank you I didnt think to do it that way. Thank God for clever people on here :o
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

Categories

  • All Categories
  • 343.2K Banking & Borrowing
  • 250.1K Reduce Debt & Boost Income
  • 449.7K Spending & Discounts
  • 235.3K Work, Benefits & Business
  • 608K Mortgages, Homes & Bills
  • 173.1K Life & Family
  • 247.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards