A bit confused about bank accounts!

*emmaaa*

I'm self-employed as a freelance contractor and am looking to open up a second current account to hold my pay in and pay myself a regular monthly wage so my accounting is a bit clearer. I don't really want to swap my main account (Barclays), although I know that I'm missing out on various rewards and incentives because of this, partly stupid sentiment (been my bank since I was 12, and I have problems with change!) and partly because it would be significantly more hassle updating all my details.

My questions are (sorry if they're a bit basic, but haven't ever felt the urge to look before!

1) Are there any accounts that have incentives for just opening the account, rather than switching? I guess this is fairly unlikely, otherwise people would be opening accounts all over the shop, but might as well check!

2) When the accounts that do require switching say "transfer 2 or more DD's", does that mean "you still have to transfer all your DD's, but there have to be at least 2 of them", or "you can pick which DD's you transfer over out of a selection."

3) When it states "salary" does that have to come from an outside source, or is it as long as the stated amount passes through the account, that's sufficient (Transfering between my own accounts for example?)

Other than this, has anyone any suggestions for a good account for using for this purpose? There would be at least £1000 pounds going through it a month, up to £1500 if I was allowed some canny money moving! I accept that the best option available with these criteria will probably be just opening a account and not getting any bonuses, but I'm an optimist! Thanks in advance for any replies!

ses6jwg

Halifax Reward is probably your best bet. Free £5 per month and no requirement to switch or pay DD's from it.

MoneySaverLog

Although Halifax pay £5 a month for putting in £1,000 a month they pay no interest on their free reward current account so either move any money out into one of their savings accounts or find another home for the money once the DD's and SO's have been paid.

innovate

Emotional attachment to a current account......not good! But you can keep your Barclays account even if you use a switcher service. They never actually close your account, so even if they transferred all your DDs/SOs, you can switch them back after a month or two. Needs good management of your records and your finances, though - - might not be worth the hassle for £100!

*emmaaa* wrote: »

2) When the accounts that do require switching say "transfer 2 or more DD's", does that mean "you still have to transfer all your DD's, but there have to be at least 2 of them", or "you can pick which DD's you transfer over out of a selection."

Some might not move all your DDs/SOs to start with. First Direct, for instance, used to ask you precisely which DDs/SOs you want to have transferred - so you could pick just 2. Not sure they still do that - easy to ask.
Nationwide will transfer everything they can.
Some DDs won't transfer - - e.g. Councils will not accept transfer requests for Council Tax DDs from anyone but the tax payer. American Express also seem to not trust another financial institution with any transfer request. Bit ironic, that.

*emmaaa* wrote: »

1) Are there any accounts that have incentives for just opening the account, rather than switching?

I think they all have wised up now and insist that you use their switcher service.

*emmaaa* wrote: »

3) When it states "salary" does that have to come from an outside source, or is it as long as the stated amount passes through the account, that's sufficient (Transfering between my own accounts for example?)

Just passing from another account is good enough. Doesn't have to be all at once, just needs to add up to the stipulated monthly sum at the end of the month.

*emmaaa* wrote: »

Other than this, has anyone any suggestions for a good account for using for this purpose?

Check Martin's main banking article

innovate

MoneySaverLog wrote: »

Although Halifax pay £5 a month for putting in £1,000 a month they pay no interest on their free reward current account so either move any money out into one of their savings accounts or find another home for the money once the DD's and SO's have been paid.

Also, if you ever go overdrawn, they get a lot more than their fiver back at the speed of light

Personally, I'd only ever use Halifax for the fiver. For as long as they let me, anyway - if & when the fiver stops, I stop, too.

MoneySaverLog

innovate wrote: »

Personally, I'd only ever use Halifax for the fiver. For as long as they let me, anyway - if & when the fiver stops, I stop, too.

Me too

mgdavid

*emmaaa* wrote: »

I'm self-employed as a freelance contractor and am looking to open up a second current account to hold my pay in and pay myself a regular monthly wage so my accounting is a bit clearer. I don't really want to swap my main account (Barclays), although I know that I'm missing out on various rewards and incentives because of this, partly stupid sentiment (been my bank since I was 12, and I have problems with change!) and partly because it would be significantly more hassle updating all my details.
.........

nothing wrong at all with sticking with 'the devil you know'; I've been with my bank for well over 40 years simply because they have never given me cause to move elsewhere. I don't pay any charges and I don't expect or want any 'perks' or 'freebies' bundled in. If I want breakdown cover I go to a motoring organisation, if I want insurance I go to an insurance company, you get what you need that way rather than what's on offer.
But I digress; why not simply ask your bank to open a second account for you? I have a 'hobby' account with mine, where I can ring-fence funds so the hobby doesn't end up taking money earmarked for household expenses. I don't pay any charges on that one either, and simply shuffle the money around instantly online.

ETA: do you have any savings or investments with Barclays too? I think it helps...

innovate

mgdavid wrote: »

nothing wrong at all with sticking with 'the devil you know'; I've been with my bank for well over 40 years simply because they have never given me cause to move elsewhere.

Like you, I have never been attracted to a current account because of 'gizmos' like phone cover, breakdown insurance, travel insurance etc. I'd like to be able to choose the policies that suit me.

What does attract me, though, are things like the Nationwide Flexclusive ISA @ 4.25%, the Santander 123 interest and cashback, the First Direct Regular Saver etc etc. If I had just stuck to my first bank account from 30-odd years ago (NatWest), I wouldn't be able to benefit from any of these sorts of offers. This is how I accumulated current accounts with most banks (I never close any). With Internet access, it is very easy now to manage multiple current accounts (and savings etc). I do use MS Money, though, to keep track of all my accounts. A spreadsheet might do the same job.

One other really good reason for having accounts at more than one bank is the FSCS limit (assuming you have savings); also, if one of them runs into trouble, you are likely to still have uninterrupted access to cash elsewhere.

Things do change all the while - - e.g. Nationwide used to have a great debit card for cash withdrawals when abroad. They stopped this some time ago, so I mothballed my Flexaccount. When they brought out their 4.25% instant access ISA earlier in the month, it was quickly revived in order to meet the pre-requisites. Much to my surprise, I then also found that the European travel cover that comes with the account is actually really good, so that saves a few tenners for at least as long as I have the ISA.

Santander, although they charge for their 123 current account, will net me at least £80 in cashback over 12 months, plus some interest from my balance.

Halifax pay me £120 a year for having current accounts with them. Lloyds used to pay better interest than most savings accounts in their Vantage accounts. First Direct's Regular Saver, only available if you have a current account with them, pays 8% interest.

This all adds up to several hundred pounds cash in my pocket a year.

Sorry about those detailed ramblings on what I do - - just thought this would illustrate that shopping around and keeping your options open at all times can be very beneficial.

*emmaaa*

Thanks everyone! Been reading up and around for a few hours, just a few more things I need help with!

1) Have been looking at Halifax Reward account, MSE states it has to be switched to get the reward, but there is nothing I can find on Halifax's website that states this, in the pdf switching is listed under "want to get the most out of your account?" but nothing to say the reward is dependant on this? Admittedly I haven't hacked my way all the way through the application, but if anyone can point me in the right direction or give some real-life experience, I'd be grateful!

2) Lloyds Classic Vantage has me somewhat confused, I like the interest tiers, I think they're ideal for the purposes I'd be using it for, but I don't understand what's in it for the bank, given it's free to apply and also doesn't appear to require switching (you can upgrade from a standard classic account anyway) Again, directional signage or experience welcome!

Cheers again!

MoneySaverLog

*emmaaa* wrote: »

Thanks everyone! Been reading up and around for a few hours, just a few more things I need help with!

1) Have been looking at Halifax Reward account, MSE states it has to be switched to get the reward, but there is nothing I can find on Halifax's website that states this, in the pdf switching is listed under "want to get the most out of your account?" but nothing to say the reward is dependant on this? Admittedly I haven't hacked my way all the way through the application, but if anyone can point me in the right direction or give some real-life experience, I'd be grateful!

2) Lloyds Classic Vantage has me somewhat confused, I like the interest tiers, I think they're ideal for the purposes I'd be using it for, but I don't understand what's in it for the bank, given it's free to apply and also doesn't appear to require switching (you can upgrade from a standard classic account anyway) Again, directional signage or experience welcome!

Cheers again!

Halifax all you have to do is pay in £1,000 a month for the free £5 a month. Nothing else required.

Lloyds TSB they just want your business I guess and use it as a loss leader for other products down the line. I like the idea of the Vantage accounts and will be filling mine up over the next year or two.

innovate

Agree with MSL.

No switching at Halifax. Just cycle your £1K through each month.

Lloyds have pestered me twice in 3 years, I can cope with that. Though I have declined their offer of any marketing bumpf. BTW, I have 3 Vantage accts - could open 2 online, had to show in Branch to get the 3rd. Predictably, they wanted to sell me some other stuff but they accepted that all I wanted was another Vantage so that I can efficiently manage my finances. This experience goes a couple of years back, though - - not sure whether they have changed their policies.