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Best Savings Account (House Deposit)
Comments
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I don't think you should rule out accounts that pay yearly just for that. The bank has to tell you if it is going to (materially) reduce the interest rate. So there's no reason to get less than your expecting. Quite often the kind of products that pay monthly are more geared towards people that want an income from their savings (eg pensioners) rather than someone saving for a deposit that wants capital growth.
Personally if I were you I'd keep the vantage accounts and slowly siphon them off into a FD 8% regular saver. Maybe chuck 5k's worth total in a 2-3 fixed ISA if you can beat the vantage rate.0 -
Alex92, you need to look at ISA rates in March/April time, when they have historically been at their highest. You could have got up to 4.25% for instant access ones, and 4% for 2-year fixes, last April. Whether anything like this will be seen next "ISA season" remains to be seen, but I reckon it is very likely that ISA rates will be beating most if not all offers in the market again next year.
But in the meantime - well done for getting yourself set up with £18K @ 4% AER!0 -
Piratipper wrote: »I don't think you should rule out accounts that pay yearly just for that. The bank has to tell you if it is going to (materially) reduce the interest rate. So there's no reason to get less than your expecting. Quite often the kind of products that pay monthly are more geared towards people that want an income from their savings (eg pensioners) rather than someone saving for a deposit that wants capital growth.
Personally if I were you I'd keep the vantage accounts and slowly siphon them off into a FD 8% regular saver. Maybe chuck 5k's worth total in a 2-3 fixed ISA if you can beat the vantage rate.
This is very true, and something that I should definitely consider and have a long think about. What I like at the moment is that my interest per month is paying nearly half of my monthly petrol cost!
Only downside to the FD account is that there is a £10 monthly fee if my account goes below monthly average of £1500, or I fail to pay in £1500 each month (means more direct debits and standing orders i think!) Also, 8% of £300 each month doesnt seem like a lot (especially in comparison to as what im getting with lloyds)Alex92, you need to look at ISA rates in March/April time, when they have historically been at their highest. You could have got up to 4.25% for instant access ones, and 4% for 2-year fixes, last April. Whether anything like this will be seen next "ISA season" remains to be seen, but I reckon it is very likely that ISA rates will be beating most if not all offers in the market again next year.
But in the meantime - well done for getting yourself set up with £18K @ 4% AER!
Yeah, I've been told to look from Feb onwards as they generally have the best rates of the year. Why would you get higher interest rates for an instant access one and a slightly lower one for a 2 year fix? That doesnt seem right?
I would be all over a 4%+ ISA like a rash right now! Definitely look into that next year.
Completely hypothetically speaking, please dont shoot me down for this, but what is the sort of 'legality' on if I were to get my mum or dad to open up 3 Classic Vantage accounts and then have 6 bank accounts, each with £6k circulating with direct debits and £1k going into all of them. It would give me £1280 per year and around £107 per month. I guess if I gave the money on paper as a 'gift' too, that they would get some sort of inheritance/gift tax on the £16k?
Think for now, I will use the 3 vantage accounts and look at another current account (has to be with a different bank now), maybe Natwests 2.85% to put the £5k in and wait until Feb 2013 onwards for the ISA rates, then stick some in that. Then any left over money, put locked up in 1-3 year bonds (depending on rates)
Does this sound good?0 -
You just need £1 in a "qualifying account" and none of the charges or minimum monthly payments will apply....can't remember now whether it is their "Everyday e-saver" or their "Savings account" which qualifies - just open one of each, put £1 in each and forget about them, and about the pre-reqs.Only downside to the FD account is that there is a £10 monthly fee if my account goes below monthly average of £1500, or I fail to pay in £1500 each month (means more direct debits and standing orders i think!)
Refer to "Bank Fee waivers" in this: http://www1.firstdirect.com/1/2/rates-and-charges/charges;jsessionid=0000nRRQiHB0iVcgMdXJasiUZRR:11qks5bhc
The only reason you'd need to pay in £1.5K a month is if you want to bag the £100 signup offer (which I think is too good to turn down). But you'd also need to use their switcher service to transfer at least 2 DD's from another current account (which isn't too hard to do, given you could set up 2 DDs specifically for that purpose. See ideas for DDs)Also, 8% of £300 each month doesnt seem like a lot (especially in comparison to as what im getting with lloyds)
8% minus 20% leaves you with 6.4% net.
4% minus 20% leaves you with 3.2% net.
Of course, you cannot dump £6K into the FD Reg Saver, but once your 3 Vantages are full, there's nothing much better than the FD Reg Saver for additional monthly savings. Or, to maximise your return, you could dripfeed your FD Reg Saver from your Vantage accounts - - see http://www.moneysavingexpert.com/savings/best-regular-savings-accounts#dripfeed.
Even if you only got 3% in your Vantage, if you used it to dripfeed your FD Reg Saver, you could make an extra £38 net in interest (compared with just leaving it all in the Vantage).Yeah, I've been told to look from Feb onwards as they generally have the best rates of the year. Why would you get higher interest rates for an instant access one and a slightly lower one for a 2 year fix? That doesnt seem right?
Different providers, different offers. Nationwide instant access was 4.25% but they didn't allow transfers-in, only new money. The best transfers-in account was Santander 2 years @ 4%. Neither offer lasted very long!Completely hypothetically speaking, please dont shoot me down for this, but what is the sort of 'legality' on if I were to get my mum or dad to open up 3 Classic Vantage accounts and then have 6 bank accounts, each with £6k circulating with direct debits and £1k going into all of them. It would give me £1280 per year and around £107 per month. I guess if I gave the money on paper as a 'gift' too, that they would get some sort of inheritance/gift tax on the £16k?
Nothing 'illegal' about it. But you need to consider that the money belongs to the person whose name is on the account. If one or both of your parents gave you some or all of the money from accounts in their names as a gift, you would not have to pay any tax on it. However, if (god forbid) they died within 7 years from making the gift, you might have to pay inheritance tax.
If your parents do want to do the Vantages (whether to your benefit or their own), they'd need to get on with it quite urgently now. It will take a few working days to set up the accounts and the DDs, and the deadline is 31 October.
And if they haven't got one yet, nothing should stop them from doing (dripfeed?) an FD Reg Saver each.......and cash ISAs.....0 -
First of, many thanks for all your help. Really kind and im learning loads. I'm only 20 - so still incredibly new to all this saving/banking malarky. Trying to keep my eyes and ears fully open and ask as many people as many questions as possible
Also, I will research drip feeding and everything else in lots of detail tomorrow, just writing this before bed.You just need £1 in a "qualifying account" and none of the charges or minimum monthly payments will apply....can't remember now whether it is their "Everyday e-saver" or their "Savings account" which qualifies - just open one of each, put £1 in each and forget about them, and about the pre-reqs.
Refer to "Bank Fee waivers" in this: http://www1.firstdirect.com/1/2/rates-and-charges/charges;jsessionid=0000nRRQiHB0iVcgMdXJasiUZRR:11qks5bhc
The only reason you'd need to pay in £1.5K a month is if you want to bag the £100 signup offer (which I think is too good to turn down). But you'd also need to use their switcher service to transfer at least 2 DD's from another current account (which isn't too hard to do, given you could set up 2 DDs specifically for that purpose. See ideas for DDs)
1) Switcher Service - Does this apply to any current account? Can I open a new account (would have to be different bankj to lloyds, say Natwest 2.85%) with £1 in there (and 2 DDs obviously) and switch that? I dont really want to switch one of my vantage accounts thats in the interest loop and go through the hassle of setting up a new one after its been scrapped.
What was be the easiest and quickest way to do this?
2) To get the Regular Savers 8% account, i thought it said you had to have only a "1st account" with them? Will have to double check this tomorrow.
3) Definitely agree that the £100 would be incredibly silly to miss out on! Will have to arrange some DDs to fix that out. Is the requirement £1500 paid into your 1st Account every month for first 3 months? I forgot.8% minus 20% leaves you with 6.4% net.
4% minus 20% leaves you with 3.2% net.
Of course, you cannot dump £6K into the FD Reg Saver, but once your 3 Vantages are full, there's nothing much better than the FD Reg Saver for additional monthly savings. Or, to maximise your return, you could dripfeed your FD Reg Saver from your Vantage accounts - - see http://www.moneysavingexpert.com/savings/best-regular-savings-accounts#dripfeed.
Even if you only got 3% in your Vantage, if you used it to dripfeed your FD Reg Saver, you could make an extra £38 net in interest (compared with just leaving it all in the Vantage).
I don't really know what 'dripfeeding' means, but will research this in detail tomorrow and look at the that link you have kindly provided.
What I am planning out in my head is to have 6k in my 3 vantages, then at the end of each month knock off the profit from all 3 accounts into the 8% regular saver with FD.
If I have 9k in the vantage, I will only get interest at 4% on the first 6k, so may aswell have 6k on the dot, as its not like im going to get 0% interest on anything over 6k. This way I will be optimizing my interest.
This means that I will be putting approx, £60 of interest (gained from the vantage accounts) into the FD savers account each month, making interest on interest.
Just quickly - How did you get the figure of extra £38 net interest (is this yearly or per month?)Different providers, different offers. Nationwide instant access was 4.25% but they didn't allow transfers-in, only new money. The best transfers-in account was Santander 2 years @ 4%. Neither offer lasted very long!
How long do these offers last for? When you say they went quickly, are we talking weeks or months?Nothing 'illegal' about it. But you need to consider that the money belongs to the person whose name is on the account. If one or both of your parents gave you some or all of the money from accounts in their names as a gift, you would not have to pay any tax on it. However, if (god forbid) they died within 7 years from making the gift, you might have to pay inheritance tax.
If your parents do want to do the Vantages (whether to your benefit or their own), they'd need to get on with it quite urgently now. It will take a few working days to set up the accounts and the DDs, and the deadline is 31 October.
And if they haven't got one yet, nothing should stop them from doing (dripfeed?) an FD Reg Saver each.......and cash ISAs.....
May suggest that they look into the vantage accounts pretty soon then!
Sounds like a good thing to do with my money for the mean time, until the ISAs come up with more attractive figures.
I will also start up the FD 8% savers and put away £300 per month as soon as I get a chance.
That means If im saving ~£1200 per month, I will still be able to save ~£1k each month into a new vantage account - Number 4, or Number 1. Whichever way you look at it :P
Can they set up a classic vantage online if they already bank with Lloyds, or is it inbranch only?
I know that, to get the new offer (6k one) I had to go into the branch and ask for it to be created, maybe differnet as im existing classic account holder though and looking to upgrade.
Cheers for the help again. I'm writing down everything from this thread and everywhere else and putting it into a giant excel spreadsheet that has all my finances in, monthly goals/aims - at the end I write if I have passed or failed them. If i have failed them I write down why I failed them and how to stop it from reoccuring. Income/outcomes, profitable growth, all my direct debits/standing orders (including who they are to, what they are for, how much is owed), any extra work I undertake/overtime, all my variable costs broken down into subcategories, owed money from people. All nicely coloured too
At the top I have the starting balances on all my accounts for that month. And each month I will insert a new worksheet with the same template.
EXCUSE THE ESSAY. TRIED TO KEEP IT AS SHORT AS POSSIBLE
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edit: realised I have been drip feeding for a while without knowing the name of it
edit 2: That regular savings calculator on the link you provided says that I will get £126 per year. This, when added to the £100 cashback seems a lot more appetising.
Not sure if the FD 8% is worth it to be honest?
If its the same as below
6.4% of 1500 (£96 per year) is what I would get. That article made an interesting point about, obviously you cant put £3k in straight away, so they give you an average interest rate for the whole year, which works out to around £1500, which gives the above math.
Obviously add this to the £100 cashback from their 1st account and it gives you £196.
Similiarly, if I put £3k up right into a bank that gives me a 3.2% net, that would generate the exact same £96 per year, as the 6.4% net one would with half that amount.
This leads me to believe that, if I did have the excess money lying around, OR, It would only take me a max of 3 months to save £3k - wouldn't I be best off ignoring the FD Savers account and finding something else with a lower interest rate, but allows me to pay in more than £300 per month into.0 -
You are doing well, keep at it!First of, many thanks for all your help. Really kind and im learning loads. I'm only 20 - so still incredibly new to all this saving/banking malarky.
Yes it does1) Switcher Service - Does this apply to any current account?
I set up two new DDs on an existing current account and asked FD to switch these (and only these), and to not close my account. They did exactly that.
What was be the easiest and quickest way to do this?
But you you also set up a brand-new account with 2 DDs somewhere, as you suggested. Probably a lot less risk to do it that way.
Yes you do. The Reg Saver must be fed from the 1st account.2) To get the Regular Savers 8% account, i thought it said you had to have only a "1st account" with them? Will have to double check this tomorrow.
something like that, yes. Just pay the £1,500 in until you got the £100.3) Definitely agree that the £100 would be incredibly silly to miss out on! Will have to arrange some DDs to fix that out. Is the requirement £1500 paid into your 1st Account every month for first 3 months? I forgot.
They should be able to set up 2 online, and might have to go into a Brnach for the 3rd. To get the 4%, best seems to call them - check the Lloyds Vantage thread.Can they set up a classic vantage online if they already bank with Lloyds, or is it inbranch only?0 -
You wont get anything better anywhere else.
Not sure if the FD 8% is worth it to be honest?
those numbers sound correct6.4% of 1500 (£96 per year) is what I would get. That article made an interesting point about, obviously you cant put £3k in straight away, so they give you an average interest rate for the whole year, which works out to around £1500, which gives the above math.
Obviously add this to the £100 cashback from their 1st account and it gives you £196.
You would get interest on the feeder account, too - - use the calculator to work out the exact numbers. I don't have time right now to use the calc again, but I think it's the £38 extra that I mentioned before.Similiarly, if I put £3k up right into a bank that gives me a 3.2% net, that would generate the exact same £96 per year, as the 6.4% net one would with half that amount.
Yes, if you have more than £300 a month, you need to find somewhere else as well. I would never give up on the 8% myself - - it beats everything else hands down. The next best instant things after Vantage and FD are
This leads me to believe that, if I did have the excess money lying around, OR, It would only take me a max of 3 months to save £3k - wouldn't I be best off ignoring the FD Savers account and finding something else with a lower interest rate, but allows me to pay in more than £300 per month into.- Halifax - cycle £1k/mth through, get a fiver a month (£60/year). But that isn't really a place for deposits
- Santander 123 @3% AER (variable) between £3K and £20K
- Natwest 2.85% esaver that came out yesterday
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I guess technically, I could do with a 4.25% ISA (when one around there is out) what I am doing with my vantage accounts and have two, but one in my fathers name - as he never uses it?
Or is that more frowned upon because it is tax free and the vantage accounts i'd still be being tax on? Just realised he would be in a higher or additional tax band so it would probably be better doing it through my mum if shes on basic tax rate?0 -
If you put your money into someone else's account, it becomes legally theirs. There could also be inheritance tax implications.0
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