MSE News: Savings loophole allows under-35s to earn 5%

MOPI

MoneysavingSam wrote: »

I also recieved this and it worried me. I think the reason they may have changed the t & c's is becuase they are expecting many people to close the account in the near future (due to possibly cutting the 5% intrest rate in the new year) as knew they wouldnt be able to cope with mortgage interviews for everyone. I hope someone can convince me otherwise but it seems logical to me the next step after closing the account to new customers is to encourage the current customers to move their money to one of santanders less generous products.

I do hope I'm wrong as I have only have the account for just over a year and havent really reaped the rewards yet, was looking forward to £600 odd intrest next sept

Good point! I am a little worried now as I too have only really had the account open for a year.

I do keep getting lots of information from Santander about a monthly saver account which also offers 5% but only for the first 12 months. It makes me a bit suspicious that they are trying to get me to shift my money.

Sillychuckie

In an official response to a complaint I made about the staffs lack of knowledge on this product (so I have their official complaint response, IN WRITING), they gave me incorrect information informing me that this account is now paying 0.1%. Its ridiculous.
I spoke to someone else over the phone who told me some of my accrued interest value, and from that, I recalculated that it was still 5%, but given that I have evidence in writing of such a complete failure to providing customers with correct info, I'll be going to the ombudsman with this letter.

chaotic_j

Good for you Sillychuckie. These are the people that we entrust with our money! They should be able to get it right but often get it so wrong!

Essex123

Has anyone here had their balance go over £50k yet? Mine is going to do so in the next couple of months, and I've been looking at the T&C's and can see nothing which says what happens in this event.

All I can find is that the maximum balance is £50k and that the rate on the account is 5% on balances of £100+ (with no upper limit).

Does anyone have any experience in this case?

Thanks!

Sillychuckie

Hi Essex123.
I opened my account when the account first became available, and I'm nowhere near the 50k yet.

Am I right in thinking that you were a bit 'naughty' and paid in more than £300 in one month, sacrificing the interest for that month, but then earning it for the following months?
If so - well done - I'm amazed they didn't close your account. Thats quite the loophole you made the most of there. I'm jealous for not having the guts to try the same (didn't want them to close it)

I can't actually answer your question though.
Its possible you'll earn 0% interest after it goes above the 50k, but, given the complete lack of product knowledge by Santander staff, if I were you, I'd go into a branch and try a partial withdrawal of 5k or something, to keep it going.
The account doesn't allow it - but they know sod all about it.

SC.

Essex123

Hi SC,

Yes, I took advantage of the loop hole in month 1 of my account. I opened the account with £100 mid month and then put over £40k in right at the end of the month. The loss of interest was negligible due to the timings. :money: It was a risk, but I figured Abbey were a shambles and would likely take no action.

I can see no evidence of any alternative rate (zero or otherwise) which is documented should the balance go over £50k, so I'm tempted to risk leaving the account running, and maybe ask them to confirm the rate once the balance is over £50k.

atypical

Essex123 wrote: »

Yes, I took advantage of the loop hole in month 1 of my account. I opened the account with £100 mid month and then put over £40k in right at the end of the month. The loss of interest was negligible due to the timings.

I thought the lower rate of interest was applied for the month following the month when you deposit too much. Timings don't matter if that's the case.

Essex123

No, its in the month of the over payment. The exact wording of the conditions is:

Make an initial deposit of between £100 and £5000 and then save between £100 and £300 per month by standing order to get the preferential rate. You will receive a lower rate of 0.10% gross/AER when you pay in under £100 or over £300 in any calendar month, but for that month only.

nottsstudent

I went into the Branch a few months ago to close the account as I heard on here the interest rate would drop to 0.1% now the account was closed to new signup's, however the lady assured me that the rate would remain 5% as no where in the terms and conditions did or has it stated that the interest rate will dip unless you breach any other rules. I am too not over £50,000 so cannot help you there. I was told this is a Nottingham City centre branch.

keet83

When I went in to a Santander in Glasgow I queried about the interest rate as it was no longer on the website. She said it was still 5% and if there were any changes then I would receive a letter letting me know.