Using a current, as a savings! (plus a bonus question)

bobsmith85

I'm looking at opening one of the A&L Premier Direct Current Accounts for the 6% AER interest, and I am aware of the restriction that it only applies to balances of upto £2.5k and the requirement that you must deposit £500 p/m. My question is (and forgive me if this has been answered elsewhere, although I've looked at quite a few threads and haven't found the answer):

Do you need to sign up to the switching service that moves your DDs and SOs across from an existing current account, or can you just use it as a savings account and forget about the fact that is technically a current account?

I am happy with my current account (HSBC) and I don't want to switch, so I only want the A&L account as a second current account that would basically be used as a savings account (i.e. put in £2.5k initially, then transfer £500 in and out to satisfy the requirement every month).

Similarly do you need to sign up to the switching service for the Halifax/BoS accounts that offer £5 p/m reward for £1k deposits?

I would ask the banks themselves, but given that they want me to switch (and the fact that A&L customer services doesn't seem to be the best!) I'd rather find out from you trusty MSE folks. Any information would be appreciated.

P.S. As a side question, when you close a savings account before interest has been paid in (for example closing an account that pays interest annually before a full year), you presumably still get the equivalent interest upto that date (interest calculated daily and all that)?

td_007

You will get the 6% rate from A&L or reward from Halifax even if you do not switch.

Re: interest, it will be calculated up to the day your a/c is closed and credited together with the capital either to the nominated bank a/c or via cheque.

chrissie_bond

I use my A&L account just as a savings account and transfer the £500 to and from my halifax account. I wonder why this isnt mentioned more often as it works well for me.
Also going to get £25 when may son opens an account with them and he also will get £25. I have had no problems with them and the staff I have dealt with have all been helpful.

fablad75

I think the only reason it's not mentioned much is because of the (relatively) low threshold. It certainly sounds good for someone starting out on their savings, but for people with a larger pot like pensioners, or those who have been saving for a while, the £2.5k limit is well, a bit limiting.

That's why more people opt for the Lloyds TSB Vantage accounts - although only 4%, the limit is £7k, and you can have up to three of them.

bobsmith85

Thanks for the advice, I will probably look to do this. You say about it being a low threshold, but I intend to use it upto the threshold and put the rest of my savings into other accounts. No matter how much you have in savings, I reckon putting the first £2.5k into a higher interest account is better than lumping a larger sum undivided into a lower paying account. IMO. Thanks again.

huw01

bobsmith85 wrote: »

I'm looking at opening one of the A&L Premier Direct Current Accounts for the 6% AER interest, and I am aware of the restriction that it only applies to balances of upto £2.5k and the requirement that you must deposit £500 p/m. My question is (and forgive me if this has been answered elsewhere, although I've looked at quite a few threads and haven't found the answer):

Do you need to sign up to the switching service that moves your DDs and SOs across from an existing current account, or can you just use it as a savings account and forget about the fact that is technically a current account?

I am happy with my current account (HSBC) and I don't want to switch, so I only want the A&L account as a second current account that would basically be used as a savings account (i.e. put in £2.5k initially, then transfer £500 in and out to satisfy the requirement every month).

Similarly do you need to sign up to the switching service for the Halifax/BoS accounts that offer £5 p/m reward for £1k deposits?

I would ask the banks themselves, but given that they want me to switch (and the fact that A&L customer services doesn't seem to be the best!) I'd rather find out from you trusty MSE folks. Any information would be appreciated.

P.S. As a side question, when you close a savings account before interest has been paid in (for example closing an account that pays interest annually before a full year), you presumably still get the equivalent interest upto that date (interest calculated daily and all that)?

Out of interest is this the A&L account that Martin mentioned in his e-mail this week that they are going to offer a £100 payment to those who open an account from Monday 11/01/2010 onwards ?

lucky77

Please note the £100 incentive payment is only paid if you transfer all your direct debits to the new account. It is also not on offer to anyone who already has a current account with Santander or cahoot.

It is not the same account as the one Martin mentioned and does not pay 6% interest on balances of up to £2500, only 0.5%.