Regular Savers - if you were me...

doitmyself

Hi Suzey
That's a pretty impressive savings schedule you've got going there, £1250 p/m with the potential to save an extra £500 - what do you with this £500 currently? And that on top of a tidy stack in Icesave.
I saw on the net worth thread here your post where you say you're ok but still can't get on the property ladder!
Sorry I'm not asking as you haven't posted on the subject particularly but just thought to myself, that can't be right??!

gelato_cat

Hi there

Not as impressive as some people's - they have 10 or 12 Regular Savers on the go and it only just clicked the other day that they might be "recycling" their money through these accounts, whereas I only use "new" money.

The extra £500 goes into my Halifax websaver (in case I need it quickly) and then into my Icesave account and/or I spend bits of it.

I'm OK in that I have £65k saved (the rest is in mini cash ISAs). I can get onto the property ladder in places I don't really want to live, but I don't see the point of buying for the sake of buying. If I buy, I'd like to get a place in London and with a deposit of say £50k (saving some cash for fees, decorating etc) I'd still have to borrow at least £150-200k for a small flat, which isn't as affordable as I'd like it to be on my salary! Plus I'd begrudge paying a quarter of a mil for a one-bed flat (and sometimes all you can find for that price is a studio!)...

Suze

doitmyself wrote:

Hi Suzey
That's a pretty impressive savings schedule you've got going there, £1250 p/m with the potential to save an extra £500 - what do you with this £500 currently? And that on top of a tidy stack in Icesave.
I saw on the net worth thread here your post where you say you're ok but still can't get on the property ladder!
Sorry I'm not asking as you haven't posted on the subject particularly but just thought to myself, that can't be right??!

gelato_cat

Yes, I save £3k a year in a cash mini ISA and this year I reviewed what I had and switched from Halifax to YBS (thanks YorkshireBoy!). I'll be needing the money within the next three years, so don't want to get involved in investments.

I've got my beady eyes on the Regular Savers as well - thanks for the reminder!

Suze

benood wrote: »

Are you maxing out your ISA contributions? Mini/maxi - if you don't need the money anytime soon over the long term you will probably be better off in equity based investments.

That's what I'd be doing if I was you (on the information provided), I'd also be watching the regular savers like a hawk to make sure that the banks didn't pull a fast one and cut the rate back.

gelato_cat

Thanks - I'll check those out!

Suze

Milarky wrote: »

Pricipality have a one year fixed rate of 6.50% Saver Bond Issue 4 for variable amounts. No withdrawals during paying in period.

Ipswich Target Saver Issue 3 pays 6.90% (variable) for 12 months but min payments are higher, with the same maximum

doitmyself

Hi again Suze

I'd still have to borrow at least £150-200k for a small flat, which isn't as affordable as I'd like it to be on my salary!

Well it is, you're SAVING (potentially) £1750 p/m! You either have a very good salary indeed, easily enough to borrow £150-£200k not to mention the deposit you already have saved, or you don't spend anything, and I mean ANYTHING!
As a devout non-saver I'm seriously impressed though, I wonder if your Reg savers/ISA's etc. will outperform property? or if you have another plan for what to with your money within the next 3-years.
I feel I'm just being nosey now so apologies for that. And good luck!
T

Well good luck

gelato_cat

I spose when I look at it like that you're right - I could borrow it and pay it back but having to pay that much for a titchy flat really bothers me.

My Regular Savers won't outperform property, I don't think, but I'm very risk averse so am happy to stick with them.

My plan is to leave the country within the next three years. No worries about being "nosey"!

Best of luck to you too.

Suze

doitmyself wrote: »

Hi again Suze

Well it is, you're SAVING (potentially) £1750 p/m! You either have a very good salary indeed, easily enough to borrow £150-£200k not to mention the deposit you already have saved, or you don't spend anything, and I mean ANYTHING!
As a devout non-saver I'm seriously impressed though, I wonder if your Reg savers/ISA's etc. will outperform property? or if you have another plan for what to with your money within the next 3-years.
I feel I'm just being nosey now so apologies for that. And good luck!
T

Well good luck

Afahmaep

Suzey wrote: »

Not as impressive as some people's - they have 10 or 12 Regular Savers on the go and it only just clicked the other day that they might be "recycling" their money through these accounts, whereas I only use "new" money.
Suze

I've got 32 Regular Savers on the go using EXACTLY your above observation. Total amount gone in to these Accounts during the first weeks of March was £8795. Total maturing during March was £8350 plus interest which will fund the April payments.
One Regular Saver not mentioned in this thread is the Monmouthshire BS 6.25% offering which allows £1000 per month to be saved with no confirmed end date. If a new Regular Saver isn't announced during April I will increase my £250 per month currently going in up to this maximum.
NB This is the only Building Society (that I know of) that insists on Direct Debit rather than Standing Order but DOES still allow the monthly amount to be changed providing you make the request in writing.

rainyday4

Afahmaep wrote: »

I've got 32 Regular Savers on the go using EXACTLY your above observation. Total amount gone in to these Accounts during the first weeks of March was £8795. Total maturing during March was £8350 plus interest which will fund the April payments.

Would you be good enough to explain how you "recycle" your savings through all these different regular saver accounts. I would like to follow your example, but am too thick to work out how to do it myself!!

Also, not sure if anyone knows how to do Martin's "drip-feeding" of savings from a high interest savings account to a regular saver? I have some savings with ICICI and wanted to drip feed it (by DD) to my Halifax regular saver, but they would only allow me to transfer money to one nominated current account.

I'm very grateful for any advice. Thanks!!

Afahmaep

rainyday4 wrote: »

Afahmaep wrote: »

Would you be good enough to explain how you "recycle" your savings through all these different regular saver accounts. I would like to follow your example, but am too thick to work out how to do it myself!!

Also, not sure if anyone knows how to do Martin's "drip-feeding" of savings from a high interest savings account to a regular saver? I have some savings with ICICI and wanted to drip feed it (by DD) to my Halifax regular saver, but they would only allow me to transfer money to one nominated current account.


I'm very grateful for any advice. Thanks!!

I don't use just one account. I am fortunate to have and use 6 Current Accounts. This allows me to fulfil the funding requirements for each one to keep them open as they all have differing criteria ranging from £500 to £1000 and to obtain some 'in-house' Regular Savers (e.g. HSBC). The latest one I am using is the Halifax 6.1% High Interest Account which does however require £1000 per month credit (non salary) but will mean I can keep £2500 there (the maximum allowed to earn the high rate) and top back up once the SOs come out which I will conveniently arrange to be exactly £1000. This may mean transferring some already opened Regular Savers over but I have a feeling this won't be necessary.
You mention having a Halifax Regular Saver so this should be an easy Current Account to open and to use.
This months matured funds via cheque (Principality BS 6.00%) I deposited into my Lloyds Account on receipt (they pay interest from Day 1) and from there to wherever via online banking, cash and cheque.
Don't over extend yourself when opening accounts.
If I had to start from scratch today I would start with the Halifax BS 7.00% and then the Leek BS 7.50% and then Principality BS 6.50%. Why that order and those. Halifax for the 6.1% account and Regular Saver (£250 PM) which is easily operated and repeatable. I'm into my 3rd year. Leek BS (£250PM) for the windfall/merger opportunity and to put through the Halifax Account and then the Principality BS (£500 PM) for the windfall/merger opportunity and to put through Halifax.
I haven't been caught up on the 'bandwagon' that is ICESAVE (or ICICI come to that) so can't advise there, though have still got an ING account with some money locked in for 6 months at 6%.
I was worried about keeping large amounts of cash in just one place and is probably what got me started on the Regular Savers route. I did at one time have over £50k in a Coventry First Account (this is an ideal alternative Current Account to get as you can withdraw £500 per day) but this been shifted so is almost all sitting in Regular Savers (with their respective merger potential as well if a Building Society; I'm due over £200 with the Portman).
Some people have just one account to do everything. I prefer an alternative.

rainyday4

Thanks for you advice Afahmaep!! I'll be sorting out that Halifax high interest account today!