Regularly Beat The Best Savings Account Rates Article Discussion Area

Jake'sGran

Getting a bit confused by the monthly saver business. If I deposit £1000 in a savings accunt paying 5.5% with interest paid at the end of the year I'll have interest of £55. Surely I would get less than this with a monthly saver paying 10%. First month £10 @ 10% = £1. 2nd month £10 = £2 for thr £20. What I'm asking is, when do they pay the 10%? Is it made clear? I did query this with one building society and they agreed that the rate worked out at about 3.something% at the end of a year. Why all the hype about monthly savings accounts? Am I being thick?

parmarminesh

Hi

Could anyone please put an end to this Llyods monthly saver saga!

I went to open this account last week. I was told:

a) I needed a current account, and even if its the most basic one, I need to show I use it regulalry with payments, standing orders, etc.

b) The monthly saver can only receive funds from the Lloyds current account, and not from any other bank.

I was told the branch manager would call me in three months to review how I use my current account and if its not up to their 'standard', they will stop my monthly saver!

Please could somebody confirm once and for all:

1. Do you have to actively use the Lloyds current account or can you just leave in a 1 pound and forget about it?

2. Can you pay into the monthly saver from another bank/building society (i.e. not from the Lloyds current a/c)?

It would be really helpful if when I go into the Lloyds branch to confront them, if I have a name and location of the Investment Product Manager who is quoted in one of the comments below (or similar) to back up my case!!!!!

Thanks so much!

Kazza242

parmarminesh wrote:

Please could somebody confirm once and for all:

1. Do you have to actively use the Lloyds current account or can you just leave in a 1 pound and forget about it?

There is a condition in the Lloyds TSB monthly saver terms and conditions that states that the current account must be used as one's 'main account'. However, you do not have to pay your salary into the LTSB current account.

I use my LTSB current account to fund my monthly saver, as I want it to remain 'active'. I believe you can leave just £1 in, but to be cautious I would recommend using the account occasionally to pay a bill or make a withdrawal etc. If LTSB deem that you aren't using the current account enough, they can convert your monthly saver into a guaranteed tracker account paying just 2.40%. Obviously something to be avoided!

parmarminesh wrote:

2. Can you pay into the monthly saver from another bank/building society (i.e. not from the Lloyds current a/c)?

Yes, you can. Some LTSB monthly saver account holders (on this forum) are already doing just that. The terms and conditions do not stipulate that the SO must come from the LTSB current account.

Kazza242

Jake'sGran wrote:

Getting a bit confused by the monthly saver business. If I deposit £1000 in a savings accunt paying 5.5% with interest paid at the end of the year I'll have interest of £55. Surely I would get less than this with a monthly saver paying 10%. First month £10 @ 10% = £1. 2nd month £10 = £2 for thr £20. What I'm asking is, when do they pay the 10%? Is it made clear? I did query this with one building society and they agreed that the rate worked out at about 3.something% at the end of a year. Why all the hype about monthly savings accounts? Am I being thick?

A monthly saver that pays 10% interest, pays 10% on the money that is in the account, for the time that it is there. What many people don't realise is that while you are drip feeding money into the monthly saver, the rest of the money is also earning interest in an easy access (feeder) account elsewhere. Therefore, to accurately compare the amount of interest earned, by using a monthly saver, you must add the easy access (feeder) account interest and the monthly saver interest together.

a) easy access (feeder) account interest + monthly saver interest
Vs.
b) easy access account interest

The winner will almost always be (a).

If you have funds of £3,000 and up, then regular savers are definitely worth it, because your money will be earning higher rates of interest than if you left it all in a easy access savings account. Please see this post by mary that illustrates that point. She has made a massive gain in interest by feeding her money into monthly savers, while the money waiting to be fed in has earned interest too.

There are different types of regular saver:
- Some last for one year (A&L, Barclays, Halifax & Abbey).
- Some continue for two years (Lloyds TSB).
- Some continue for many years with a max balance limit (Scarborough)
- Some go on and on and on (Principality BS & Derbyshire BS)

Martin's regular savings article explains further.

Aark

1. Do you have to actively use the Lloyds current account or can you just leave in a 1 pound and forget about it?

2. Can you pay into the monthly saver from another bank/building society (i.e. not from the Lloyds current a/c)?

It would be really helpful if when I go into the Lloyds branch to confront them, if I have a name and location of the Investment Product Manager who is quoted in one of the comments below (or similar) to back up my case!!!!!

I queried this with Lloyds TSB and my e-mail was passed to the Lloyds TSB Customer Service Recovery Unit in Birmingham. I then received the e-mail that I quoted earlier from Alan Mochrie (Lloyds TSB Investment Product Manager).

I was told, "The information contained on moneysavingsexpert.com I]sic[/I is in fact correct and we have relaxed the account opening requirements since the launch of Monthly Saver; meaning that the account is now more accessible. A Lloyds TSB current account is required, it may be opened with £1; furthermore, this Lloyds TSB current account does not need to be the funding account for Monthly Saver."

I have just sent another e-mail to Lloyds TSB explaining that they have still to amend the T&Cs on their website, but if anyone would like to ask for themselves just send an e-mail to [EMAIL="CONTACT.US@lloydstsb.co.uk"]CONTACT.US@lloydstsb.co.uk[/EMAIL].

Aark

I have just sent another e-mail to Lloyds TSB explaining that they have still to amend the T&Cs on their website...

[EMAIL="CONTACT.US@lloydstsb.co.uk"]They[/EMAIL] have now replied, as follows:-

I now have a confirmed date for the changes to go live! We shall be running the amendment overnight on 14 September; meaning that branches, internet and printed forms will now be amended from 15 September onwards

So there is over a month to wait if you want to see the amended T&Cs in print before you apply.

stphnstevey

I opened one of these and put the money in through another account. I deposited £1 into the Current Account. Do you think this will be enough to allow me to continue using the Reguler Saver?

Aark

I opened one of these and put the money in through another account. I deposited £1 into the Current Account. Do you think this will be enough to allow me to continue using the Reguler Saver?

Yes. This should be confirmed on 15 September.

capehorn

So this means that if I open a regular saver before the 14th of September, the old T&Cs apply, but there will be new ones for people opening their accounts after that?

I need to get this right because I planned to open one around the 25th September

Aark

capehorn wrote:

So this means that if I open a regular saver before the 14th of September, the old T&Cs apply, but there will be new ones for people opening their accounts after that?

I need to get this right because I planned to open one around the 25th September

I opened my Monthly Saver in July and will not be using the current account at all (apart from holding a £1 balance). Lloyds TSB have been saying that there is no requirement to have your "main account" with them since before 27 June (that's when MSE Dan first posted the answer on this thread).

So it doesn't make any difference whether you open the account before or after 15 September. All that is changing is that the printed leaflets and the website will be updated to reflect the correct terms (as given in Martin's article).

If you want confirmation first-hand, just send an e-mail to [EMAIL="CONTACT.US@lloydstsb.co.uk"]CONTACT.US@lloydstsb.co.uk[/EMAIL].