Should I switch?

shagzdan

Hello again Money people,
I love dosh, so it pains me to see that I am getting a lower interest approx 0.09% on my account than the current inflation rate of 4%? so for every pound in my account im losing just short of a penny right.
Also as I am a basic taxpayer 22% this surely means whilst my money is in my current "classic" Ltsb account im losing money quicker?

Any clarification would be great thanks.

equitydealer

Inflation is around 2.5%, so you are right, you are losing money in real terms on cash sitting in your c/a.

For minimal hassle, why don't you open the Lloyds TSB online saver (4.25%/4%) which will allow you to instantly transfer money between both accounts, maximising your interest. It only takes minutes to set up with no paperwork!

What many people do is keep a balance of say £100/200/300 in their current account and sweep the rest into the linked savings account. When you need to pay a bill transfer cash from your savings acc into your current acc. Make sure you don't go overdrawn on your c/a though!

shagzdan

I wonder how many people don't realise this fact?
It would be interesting to start a thread maybe.