ITV1 savings makeover, or did you fix savings at 7% plus?

sdooley

The only thing that's "wrong" with regular savers is they don't provide a very useful home for people with a huge pot of money. As I don't have a huge pot of money, I find them very useful!

I have a two year 7% bond with the Yorkshire building society, their long-term regular saver (which has lower rates but allows you to keep paying money in over the years so you can benefit from compounding without the hassle of changing accounts) and the one year regular saver from Barclays at 7.75%. Plus the 8% regular saver from first direct and the 7% regular saver ISA which I really hope they repeat next year too!

I used to have the 12% regular saver from alliance and leicester. I call that a false economy, the fuss of banking with them was not worth the hassle compared to first direct who are easy to bank with and pay good rates on their special products (as well as a modest interest free overdraft if I'm naughty at the end of the month). I know you can run two current account simultaneously and transfer money backwards and forwards to meet the criteria but for me it wasn't worth repeating.

Nick_C

I'm sure I'm not the only person on here getting 12% on the Halifax Regular Saver, and 6.25% fixed on the qualifying account.

butterfly72

I've got:

10% Halifax RS
7.75% Barclays RS
6.7% B&B fixed rate savings bond
2 x 7% Halifax fixed rate savings bond
6% Halifax guarenteed saver
8.1% A&L current


Most of these will have ended by NOv 09 and hopefully by then property prices will be down a fair bit more and I'll be looking to buy a house.

People on here have some great rates tho. I thought I was fairly on the ball but half of them mentioned here passed me by!!

bigbrian2

During October 2008 I fixed at 6.98 with the AA savings and another with Egg savings at 6.5 both for 12 months. I put the max £50K in each to remain safe and its saved a fortune in what would have been lost income from the absolutly crap returns being offered now. I hope this resession has ended by the time my fixed rates end otherwise I am going to be well poor!

sloughflint

isofa wrote: »

Never really got regular savers, compounded it's still a much poorer rate than a good solid fixed rate. You are limited greatly by the monthly deposits, the headline 10% rates are there to grab people who aren't very good at maths

I can't believe you said that after all the discussions on this sub-forum Isofa.

The problem now of course the feed accounts are usually variable rates but I still reckon that those people that took that 10% Halifax deal and Tesco Internet saver are still slightly better off than the one year fix rates around at that sort of time.

If we guesstimate Tesco being 6.5% for 4 months, 3.6% for the next four and say 2.6% for the last 4, I make that an approximate overall rate of 7.35% on £ 6000.

Pendle_Gazza

I actually agree with isofa. Being drip-fed, you can more than half the advertised rate, and the money you can deposit is limited.

So a "generous" 12% offering a £500 a month would get you less than 6% on £6K - and that's if you strictly deposited on time each month.

Even at their peak, the 'effective' rates were worse than normal rates on the best standard savings accounts at that time.

However, I do wish I had chosen to take a couple of fixed rate term accounts last summer - I certainly ballsed-up there!

Tibbledom

sloughflint wrote: »

The problem now of course the feed accounts are usually variable rates but I still reckon that those people that took that 10% Halifax deal and Tesco Internet saver are still slightly better off than the one year fix rates around at that sort of time.

If we guesstimate Tesco being 6.5% for 4 months, 3.6% for the next four and say 2.6% for the last 4, I make that an approximate overall rate of 7.35% on £ 6000.

Nice bit of arithmetic. Come up with a similar figure myself.

And as you say we are making this comparison in hindsight, knowing that interest rates have dropped more than expected. Fixed rates in retrospect are always going to have looked good value relative to variable accounts (with regular savers funded from feeder accounts somewhere inbetween) when interest rates subsequently fall more than the markets are expecting.

That the sums still show the 10% regular saver was good value even in this scenario shows regular savers are numerically worthwhile even if the time and effort is not cost justified for some.

Of course there was a window of opportunity in November/December time for the 7%/6% fixed rates when the banks took time to withdraw these fixed rates, but some of these will have been taken up by people who already had regular savers as well.

My previous post was intended to be light-hearted, isofa did give us a lot of help over on the Tesco forum, and everyone is entitled to their view, but I do think the numbers show regular savers work for some.

sloughflint

Tibbledom wrote: »

but I do think the numbers show regular savers work for some.

The real winner around that sort of time was to open a joint 6.25% Halifax account ( that can still be added to ), a 12% Halifax RS each and that Egg 6.3% fixed savings account for feeding I think.

That would give 8.46% on £ 17 000 for the year.

sloughflint

sloughflint wrote: »

The real winner around that sort of time

A little correction to myself. Putting mathematics aside, the real winners are the people who took out long term fixes.:o

amcluesent

Never quite got 7%+, spreads of 5% to 6.5% gross on bonds etc. running through to autumn 2009. At least the 5% Web Saver Reward is good until Nov 2009 by which time rates will be on the up again!