Regular Saver accounts drip fed from ordinary online savings accounts

savetilibleed

Regular Saver Accounts seem to be set up for people who have a regular income to their current account, from which a standing order is setup to pay into the regular saver.

If like me, your income is low and the money coming in (from benefits and savings interest) is needed to live on, the only way seems to be to manually transfer money every month, as you can;t arrange regular withdrawals from savings accounts, in time for the S/O out to the regular saver. But to do that there is the limbo time whilst the money is being transferred from one place to another - two steps if a non (say) Barclays current account is involved.

There isn't a huge amount to gain from drip feeding, unless it is the max amounts these accounts allow and the interest lost in limbo might cancel out the gains.

Am I off the mark?

Wookey

Horses for courses really as it depends on each persons circumstances, they aren't for everyone and where someone has a lowish income then ISA's should probably be the first port of call.

My situation was that i received a large enough lump sum from redundancy to clear my mortgage, i then setup a regular saver standing order which is for roughly the same amount as what my mortgage payment was, i never miss the money going out and i hope to have built up the capital i used to pay the mortgage of within 8 years at current interest rates. The regular saver account i have still pays more interest after tax than the current ISA offering from same establishment. The mortgage had approx 20 years left on it and the way i look at it is get your money working for you as best you can within your means.

rb10

It all depends on where the money is and what accounts you have. If you can transfer the money straight into a current account, then the standing order can be set up from there to automatically go out, so that's only one step.

If both banks use FP for standing orders, or it's within the same bank, then there would be no loss of interest during the transfer, as it would take place immediately.