Any 8%+ Reguler Savers

stphnstevey

I didn't want to go to the hassle of posting figures but here goes:

7% RS £250 month fed from 5% feeder account
(at the end of each year the 3K from the RS is invested back into the feeder account and re-cyled via drip feeding the following year into a new 7% RS. NO new money is used)

VS

6.5% RS £500 month fed from 5% feeder account

(Happy now we are using ACTUAL accounts?!!!!)

Going straight to three years investment (taking into account feeder account interest):

6.5% RS
£2628 or £876 per year

7% RS
£469 or £156 per year

Now Kazaar would be very happy at this point as he would solely look at the amount of interest and go with the 6.5% RS. However, if he stopped to think about how much was actually invested, he would see that £18K has been invested in the 6.5% RS to give this interest, but only 3K in the 7% RS (being recycled every year)

So if you work out the "true" rate of return on investment:

6.5% RS
£876/18000 = 4.87%

7% RS
£156/3000 = 5.21%

If a 7% RS is better than a 6.5% RS, then you can bet that a higher rate RS beats the 6.5% RS by an even bigger rate. But Kazaar didn't want to compare the 6.5% RS to these, I wonder why?

masonic

Stphnstevey, I apologise for being so blunt, but that post demonstrates that you have no understanding of the mechanics at work here. You have constructed a strawman. £12000 of that £18000 was available to be put elsewhere in the first year; £6000 of it was available to be invested elsewhere for two years. All the work that has been put into creating a fair platform for comparison has gone straight out the window, eh?

stphnstevey wrote:

so far the only agreement has been masonic who agrees with ME in post 64

Erm, aside from the fact that you wrote post 64, I was agreeing that recycling past years money through more regular savers was a fair thing to do.

There is clearly a point at which short-term regular savers win out. Nobody is disputing that. It is the actual point at which particular account wins out that seems to be in some dispute.

Trying to produce an accurate figure over a 3 year span at the level of accuracy being discussed is diabolically tough, but what is absolutely clear is that long term accounts with apparently lower rates than other regular savers on the market can outperform those latter accounts. The best of these easily compete with the best short term accounts.

stphnstevey

If I have no idea of the mechanics here? then I guess you do then? So post your figures and we'll see if you have a better idea. If you don't post your figures then I guess your saying you know no better than I do!!

Whether I wrote post 69 or not was not the issue. As you have stated again, the only agreement so far has been with something I said rather than Kazaa, as Kazaa was trying to say that others agreed with him rather than me.

Your closing statement, draws what you call a 'clear' conclusion. But you don't back it up with the numbers. As much as you called my post a strawman, yours is the same as you make a debatable statement, without proving your theory.

I do take your point on board about if you should take into account the interest of where the 18K has come from originally. You seem an intelligent individual, along with Kazaa. Why can't we find a comparator that all of us agree on? (and I thought quadratic equations at school were hard!!)

dano_3

hi all,

Just trying to open my first reg saver account, with Alliance & Leicester. As its the best current account at the mo I thought I would also open up that one as well. So I want to open a premiere direct current account, and a premiere regular saver acccount.

The web site suggests that the reg saver can only be feed through a premiere current account (which has crap interest) so I thought Id try and only get the 2 accounts I want.

So in the T&C's of the reg saver I can see "4.1 You may only open an Account in conjunction with a Current Account." to me that suggests that any current account will do.

Im waiting for a line manager to call me back (although I doubt one will) has any one else come across this problem and did they have to open all 3 accounts or did A n Leicester buckle ?

rgds
dan

masonic

stphnstevey wrote:

If I have no idea of the mechanics here? then I guess you do then? So post your figures and we'll see if you have a better idea.
<Snip rest of rant, completely unread>

Oh, you will not post your calculations but I have to post mine. :rolleyes:

You posted here asking for help. A few people have tried to do so and all you can do is throw it back in their face. If your position is so indisputably correct, then nothing I say will change your mind. It would be pretty stupid of me to try.

You have some preconceived notion of what you want the answer to be, and every time it doesn't work out that way, you introduce another level of complexity in the vain hope you can confuse us into submission; however, now you have run out of things to add, so suddenly you have come up with the answer yourself. How convenient.

From now on you're on your own. Happy swimming.

masonic

dano wrote:

Im waiting for a line manager to call me back (although I doubt one will) has any one else come across this problem and did they have to open all 3 accounts or did A n Leicester buckle ?

No, unfortunately you have to make a choice between the Premier account + 12% RS or the Premier Direct. They will not let you open all three.

stphnstevey

Are you blind - have I not just posted my figures a couple posts back!

My notions are not preconcieved. I have an inkling that LONG TERM savers don't outperform SHORT TERM savers, yes. Just as you have that they do outperform.

But my inkling was based on half way through this thread, having a bash at working out the figures and coming to that conclusion. I took on board your points about where the 18K was coming from in the three year period, so my opinion is not unchangable. I'm willing to look at anybody's figures who can work this out.

I suspect, you don't have the answer either, thats why you are really dropping out of the conversation.

wardrobe

the mrs opened up a lloyds tsb regular saver today the woman behind the counter said that the payment MUST come out of the lloyds current acccount, is this correct or should i just cancel the Standing order online in the lloyds account and create one in my cahoot current account instead?

masonic

stphnstevey wrote:

Are you blind - have I not just posted my figures a couple posts back!

Oh, you were being serious?! :rotfl:

stphnstevey wrote:

I suspect, you don't have the answer either, thats why you are really dropping out of the conversation.

You seem to lack understanding of the fundamental difference between 'can not' and 'will not'. Believe what you want. You've done a good job of that so far. :rolleyes:

stphnstevey

I'm sure I called you an intelligent person - I just can't remember why?