Advice

alex25f

Hi i need some info on the regular saver from halifax, I have no option but the cancel the standing order to pay in the monthly amount due to hard times really and ive only had it open 7months. It will get closed and i was just wondering what will happen to the money thats already in there? any help appreciated

mau408

I did one several years ago. The account closes and gets put into a nominated account in a couple of days time and the interest is reduced to a websaver without card rate.
I think its 0.20% but I'm sure someone will correct me. I'd recommend keeping it open and reducing the standing order to the minimum (£25 I think) if you can afford it, but I guess if needs must lets say you put in the max £500 a month for 7 months (at 5%) on the first thats equivalent of approx £3500 with an interest of £54. If this is converted to 0.20% then you get about £3. Its quite a big difference but remember I've made a lot of assumptions i.e. like you are on 5% and the dropped rate is 0.20% and I haven't taken any tax off and that your payments went in on the first of the month and you paid £500.
Also I've done it over a 7 month term. so over 12months you should get more.

Consumerist

According to the Halifax web site :-

No withdrawals or missed payments - during the 12 months otherwise this account will close. The money you've saved (plus any interest - which will be paid at current Halifax Web Saver - without cash card rate) will be transferred to a nominated Halifax/Bank of Scotland savings account

This would suggest that you get to nominate which account the closing balance is transferred to. Check with Halifax to confirm.

The account is currently paying 2.00% AER (from 16 Oct 2009) but I can't find any reference to a previous rate so I'm assuming thats the rate you are currently getting.

If you paid in £500 per month for 7 months then the transferred balance will be about £3,500 with most, if not all, interest lost if you close the account.

I agree with mau408 that, if at all possible, you should consider reducing your monthly SO to the minimum £25 rather than lose the interest to date.