Barclays 6% savings

exel1966

shaf00uk wrote: »

Any regular saving accounts are very misleading with the headline rates.

The actual rate for this account is 3.25% (gross) as you are drip feeding into the account. So the net is actually 2.60% (basic tax payer) or 1.95% (higher rate).

Still not a terrible rate but if you have a lump sum or a regular investment then put the money elsewhere e.g. this years Golden ISA account first - you can get up to 3.61% with the same bank. Once that allowance is used then start drip feeding into this account.

I've based my calculation on £3,000 investment (£250 x 12).

Oh also, it does not automatically turn into an ISA account - you need to fill in form, give you NI number etc so that tax is not taken out of account.

I think misleading is the wrong word. It should be misunderstanding for not actually asking how these accounts work.

You get exactly what it says on the tin - 6% for every penny in the account.

rb10

shaf00uk wrote: »

I know it can be confusing. Using the regular saving calculator you can obtain a similiar answer; £250 per month, 6% int, 12 months, no tax = £96.63 interest.

£96.63/£3000 x 100 = 3.22% (gross).

If you are going to compare interest rates, then you must compare like with like.

So, if you claim that the Regular Saver will give 3.22% gross, a similar calculation will tell you that putting £250 per month into a 3.5% account for 12 months will give you £56.88 interest, which, using your method above, equates to 1.9% gross. So the Regular Saver at '3.22%' is significantly better than putting it in a normal account, where the best you'll get is about '1.9%'.

shaf00uk

Essex123 wrote: »

I don't see how the rate is misleading. You get 6% on the money you invest for the time it is in the account. So the first month you can get 6% on £250, the second 6% on £500 and so on. The interest paid is calculated in the same way as on any other account.

It's your calculations which are misleading!

OK - they are not misleading, just misunderstood. I've based my calculation on investment of £3000.

-End-

LucyTheDwarf

shaf00uk wrote: »

Any regular saving accounts are very misleading with the headline rates.

...

Oh also, it does not automatically turn into an ISA account - you need to fill in form, give you NI number etc so that tax is not taken out of account.

Regular savers are not misleading with their interest rates. What they advertise is what they pay. It's just that people do not understand interest!

It does not turn into an ISA automatically - it does not turn into an ISA at all! Totally different kettle of fish.

Anyone know how long these take to open? Applied online on Friday (already bank with Barclays). I'm loving the fact that interest is monthly, and withdrawals can be made (although at a penalty) - because even the with penalty rate is my 2nd highest for instant access right now!!!

Lokolo_2

gkm wrote: »

I've got one of the Barclays 6% regular savings accounts, and I think at the end of the year (Feb 2010) it turns into an ISA. I've already got an ISA with another bank and I'd like to know how I can get hold of the money in Barclays without paying tax on my savings and ultimately losing most of the interest I've gained? I know I can't pay into more than one ISA per financial year which is why I've held off paying anything into my existing ISA since April 09.

That would be interesting! I have that Barclays regular saver too AND i have the Golden ISA from Barclays as they are my main bank! So if what you said is true then assumably when the regular saver ends my money will go into my Golden ISA without even asking me if i want it there? and what if i go over the ISA limit because of barclays doing this? :beer:

KTF

The Regular Saver does not turn in to an ISA when it matures.

At the end of the 12-month term your account will automatically switch to an instant access savings account that is available at that time.

From: http://www.personal.barclays.co.uk/BRC1/jsp/brccontrol?task=homefreegroup&value=14937&target=_self&site=pfs

Lokolo_2

KTF wrote: »

The Regular Saver does not turn in to an ISA when it matures.

From: http://www.personal.barclays.co.uk/BRC1/jsp/brccontrol?task=homefreegroup&value=14937&target=_self&site=pfs

Thank you i have gathered that by now, would be interesting if it did though :T

Richard_Cocks

shaf00uk wrote: »

Any regular saving accounts are very misleading with the headline rates.

The actual rate for this account is 3.25% (gross) as you are drip feeding into the account. So the net is actually 2.60% (basic tax payer) or 1.95% (higher rate).

Still not a terrible rate but if you have a lump sum or a regular investment then put the money elsewhere e.g. this years Golden ISA account first - you can get up to 3.61% with the same bank. Once that allowance is used then start drip feeding into this account.

I've based my calculation on £3,000 investment (£250 x 12).

Oh also, it does not automatically turn into an ISA account - you need to fill in form, give you NI number etc so that tax is not taken out of account.

*HEADDESK*

Please stop spouting this nonsense. The money earns 6% interest, however you look at it.

Consider an instant access account at 6% that you save a monthly amount to, you'd earn the same interest in the end.

If you choose to indulge in the misconception that regular savers pay effectively lower interest then that's fine but don't spread such nonsense on help boards.

Regular savers are a product that's aimed at people who wish to save regularly (the clue is in the name), and as such you can get very high amounts of interest in return.

If you have a lump sum to save or invest then there are other products available but 6% is still 6%.

Regular savers are ideal for anyone wishing to save a regular amount out of their salary every month, the interest rates are simply unbeatable. Canny savers will open their regular savers at the end of March so on maturity they can be dumped into the new year's ISA.

Booradley_2

Like many other products (financial and otherwise) these products are hooks. Tha bank caps the amount you can invest to limits its exposure from big investors. There are two ways the bank gets it's money back from you. It can cancel the bonus part of the rate if you miss a payment. It hopes that you forget that the rate comes tumbling down after the first year and it keeps hold of your money in a poorly paying low interest account.
Solutions: pay the max per month into the account by standing order to avoid missed payments and be aware of the date the account is changed to low interest, then move it.