Monthly/Regular Savings - the catch?

kenshaz

The only positive point about a regular saver is that it allows you to save at good rate of interest ,to accumulate for next years cash ISA. I save £250 with Halifax regular saver,which gives me the max for my ISA,I do not need to see an explanation of the math's to comprehend that I will not get 7% for the £3000,but I get a very good drip feed savings account.Surely you do not need a Financial Adviser to tell you that,why can't any member of staff explain ,we have gone litigation crazy .

PoorDave

masonic wrote:

Yes you can. You just need to route it via your A&L current account. It will just take 1 day longer for the money to reach the regular saver than if you were able to transfer it directly.

Simple really!

Some people just have a defeatist attitude.

My explanation above doesn't take into account the slight technicality of when in the month you pay in vs when in the month the account term ends, but i think it's easier to understand that way, and not too far off

regularsaver1

I pay £250 into an ISA investor instead - this has performed well for me too

ReportInvestor

I use virtually all of these regular savers for as many members of my family as possible.

They're great............

I've never seen anything like it in 40 years in terms of savings value v inflation.

Some of them even have [increasingly significant] windfall potential thrown in for free . Unbelievable.

Ipswich BS, Yorkshire, Principality & Scarborough spring to mind, but there may be others.

Jake'sGran

Bisoy wrote:

Hi newfoundglory,

You have raised a very interesting issue here and I hope somebody could share and expand a bit more. The reason I was keen to know is my wife and I are about to open a regular saver account. If you read my other post regarding regular saver vs. e.g. ICICI basically just want to know which one are we better off. We both have already used our full ISA subscription and both have ICICI account. I am hoping some experts share their thoughts. Many thanks.

I think it is an interesting issue too and yesterday on another thread I said I would not comment on it again. I checked with one of the banks when they first started offering these and the lady agreed with me that, in fact, the rate is not as advertised. Of course, this is because is being deposited monthly as already explained. The thing with the A&L one is that you have to open one of their current accounts from which to feed the regular saver and you have to put at least £500 into the current account each month on which they pay an extremely small rate of interest. Therefore, in my case, I would be having to take the £500 each month from my high interest account
to put in their current account and then arrange a standing order from this to the monthly saver. Only £2500 in the monthly saver gets the 12% interest. anything over that gets .1%. I really can't see the benefit and why anyone would want the hassle. Had a look at the Lloyds TSB one last night and that too has strings.

Riviera_Kid

As you can see from my post count I'm a bit of a newbie when it comes to money-saving, but some of the comments you made confuse me. Hope someone can help me

"I checked with one of the banks when they first started offering these and the lady agreed with me that, in fact, the rate is not as advertised"

I don't understand what you mean when you say the rate is not as advertised. If one account is 5% AER and the regular saver is 8%, surely the latter is better?

"I really can't see the benefit and why anyone would want the hassle."

According to the figures in the regular savings article, you gain an extra £250 after the two years from using a Lloyds Monthly Saver (if you normally keep your money in a 4.75% saver). To me that is well worth the hassle, even if it required three trips to the branch for them to get it right :rolleyes:

filo_2

hi there people - i am new here so forgive me if i am missing anything

i have recently been through the whole regular savings account decision.

i have gone for the a&l premier regular saver (500 monthly from halifax to a&l premier current account (to qualify), 250 monthly into the premier regular saver and 250 monthly back to halifax web saver)

i did the comparison with the lloyds 2 year account (assuming that i would be able to have 2 x 1 year a&l regular saver accounts back-to-back). i have just read that this is not the case (need to close both accounts and re-apply)

however, i think it is probably still the best one because:

- two years is quite a long time - i may need the money

- two years is quite a long time - in a year's time there will probably be more attractive products available.

i may do another one - can anyone recommend the next best account and is there is any problem with setting up yet another current account? - i already have halifax and a&l

one more thing - where does the £2500 limit (mentioned above) for the high interest rate come from - i haven't read that anywhere?

Jake'sGran

masonic wrote:

Yes you can. You just need to route it via your A&L current account. It will just take 1 day longer for the money to reach the regular saver than if you were able to transfer it directly.

Yes, I understand that and if they were paying 12% on each monthly savings amount of say £500 I would jump at it but, alas, no. Too much to expect. Also, I believe that if a person misses a monthly payment into the current account there is a charge on the account.

regularsaver1

I don't see the problem. the bank can not pay you interest until they actually receive the money

ReportInvestor

There really is no catch, apart from Homer's point that you might not be able to access some of the money depending on the individual account t&cs.

But you do need to be prepared to get organised - and that does take time.

I have a significant proportion of my lump sum cash savings flowing around through these accounts before it heads back to the best lump sum account at the end of the term or when these fabulous regular savers disappear from the scene.

To filo
Welcome to the site . If there are more attractive savings products available in 12 months I'll eat my virtual hat & open a bottle of champagne to celebrate .