Halifax variable rate websaver 6.26% 1yr

ashm1

The 6.26% 1 year fixed rate fixed term looks interesting. I guess if bank rate went to 5.75% Halifax would bump the one year up a bit. My worry would be inflation rising over the fixed rate year. Would this 6.26% need to be balanced with an account that's linked to Bank rates or some index linked certificates?

Thanks,

Ashley.

UK annual rates from 10th May 2007

Term Term (dys) AER Gross pa Net pa
3 months 90 5.56% 5.45% 4.36%
6 months 180 5.68% 5.60% 4.48%
9 months 270 5.74% 5.70% 4.56%
1 year 360 6.26% 6.26% 5.01%
2 years* 720 6.12% 6.12% 4.90%
3 years* 1080 6.12% 6.12% 4.90%
4 years* 1440 6.12% 6.12% 4.90%
5 years* 1800 6.12% 6.12% 4.90%

/http://www.halifax.co.uk/savings/personalrates.asp#variable_rate_web_saver

Milarky

It looks interesting if what's in your websaver is what's in mine - enough to fund the £250x12 regular saver - which has only just matured. With the Regular Saver,you can put in less than the maximum over 12 full months - but with the maximum payments at the start: say 5 payments @ £250 [max]then 7 @ £25 [min]. That leaves 7x£225 = £1575 which could sit at 6.25% instead.

Is it worth it?
Regular Saver: average balance = !! [50/12] x £250 + [28/12] x £25] } = £1100

Regular Saver: 7% x £1100 = £77.00

1 year WS: 6.26% x £1575 = £98.60

Feeder WS: average balance = £3000 - £1575 - £1100 = £325

Feeder WS: 5.00% x £325 = £16.25

TOTAL: £77.00 + £98.60 + £16.25 = £191.85 = 6.395%

Compare with:

Regular Saver: average balance = !! [78/12] x £250 } = £1625
Feeder WS: average balance = £3000 - £1625 = £1375

TOTAL: £1625 x 7% + £1375 x 5% = £182.50 = 6.08%

Assumes:

1) WS variable rate does not increase
2) no alternative feeder account used

So it's a lazy man's way of boosting return I suppose

[All combinations: months @ £250/interest]
1 184.96 2 187.05 3 188.76 4 190.09 5 191.05 6 191.64 7 191.85 8 191.68 9 191.14 10 190.23 11 188.94 12 187.27

Compound_2

I would point out an error in the title of the thread ‘Halifax variable rate websaver 6.26% 1yr’. It's the Fixed Rate Halifax Web Saver which is 6.26% 1 yr. The Variable Rate Halifax Web Saver pays 5% variable, instant access. It’s not surprising that people get confused between the two when the Halifax Regular Saver information lists 'Halifax Web Saver' as one of the accounts to sweep to on maturity. This implies you can nominate an existing (or just opened) 6.26% 1 yr account (or other term) when opening the Regular Saver. I don’t know if anyone has tried this. Adding to a fixed account once opened seems nonsensical, even if done automatically by Halifax.