Savings account advice please :-)

this_charming_girl

Hi everyone need a bit of advice if possible?
I only have two bank accounts, one a flexaccount with Nationwide, and the other a savings account with Nationwide again.
The savings account used to be a smart saver kids account until I turned 18 four years ago.
The savings account only makes under £1 in interest a year- is this bad? I have looked at other savings accounts in which you can get up to £8 in interest a year.

I have about £600 in the account at the moment, as i only work part time whilst finishing my degree. And the account was set up for me by my Grandad so I am not sure where to even start!
Are there any better savings accounts out there or should I stick with what I have?
Thank you :-)

xylophone

Do you have a cash isa? http://www.nationwide.co.uk/savings/cash_isa/easy_saver_isa/default.htm

leeroy2009

may be worth upgrading to flexdirect account, you wont get the offers on the flexdirect (interest at 5%), due to I guess you not been able to pay in £1000 a month, but having the flexdirect account would give you accses to the flexculsive isa at 2.50% tax free.

psychic_teabag

£1 interest after basic tax per year on £600 balance is about 0.2% gross p.a. Yes, that's bad. £8 would be around 1.6% which is probably about as much as you can get from an instant-access savings account at the moment (but still not great).

EDIT: I think there are instant-access ISAs paying better than that.

But you can do better still with some current accounts. Nationwide do one offering 5% on up to £2500 - maybe you can upgrade your existing account to one of those. Even though that's taxable, it's better than you can get from an instant-access ISA account at the moment. (And maybe you don't pay tax at the moment anyway ?)

That does require £1000 deposit per month, but you can usually achieve that just by moving your existing money out and in.

leeroy2009

shes a a part time working student, so yes if she can bank £1000 a month the flexdirect account would be the best choice but only for a year, hope she comes back with income details.

psychic_teabag

leeroy2009 wrote: »

having the flexdirect account would give you accses to the flexculsive isa at 2.50% tax free.

Does a flexaccount not already give access to the flexclusive ISA ? (Provided it's used as a "main" current account.)

leeroy2009

only if shes been paying in £750 for last 3 months, and im assuming as shes part time working she may not of met that criteria.

To be eligible to apply for a Flexclusive ISA, you must either:

1. Hold a FlexAccount with a Visa debit card (not cash card or cash card+) and:
   • Have been paying in £750+ a month (excluding internal transfers) for the last 3 months; or
   • Complete an account transfer to us (from a non-Nationwide account) using our Account Transfer Service or have done so in the last 4 months; or
2. Hold a FlexDirect account or FlexPlus account

psychic_teabag

Of course, if you can deposit £1000 per month, a Halifax Reward current account might be a better bet, since that will give you £5 per month (£60 per year, after basic tax), vs the £30 before tax you'd get at 5% on a balance of £600. (Oh, no, it's down to £750 per month now.)

Plus Halifax will pay you £100 to transfer your account to them.

[If can get away with it, you could have both accounts : take the £5 from Halifax each month, but still keep the money in Nationwide earning 5% ! They just both need to think it's your main account.]

leeroy2009

she would also have to take note, that a savings account with nationwide would likely class as a internal transfer to one of there current accounts, it would require opening a new bank account with different bank, transferring the nationwide savings to the new account, then back into the nationwide current account.

we need her to come back so we can help her.

leeroy2009

yes your right teabag about the Halifax account too.

this_charming_girl

thanks everyone.
right, to the numbers.
I have literally just finished my degree, and i'm just waiting to graduate.
I work as a check-out operator at a DIY warehouse, and i earn approx between £3-400 a month and with bank holidays added in around £4-460.

Ive just been offered an interview for a pgce next week so until i know that i have a place on the course, that's all the wages I will earn.
I am planning after my holiday to start putting some of my wages into my savings account so i guess i could before Christmas save an extra £5-600 pounds.
Ive had a look at Nationwide's other accounts but if i am honest I haven't got the foggiest at all.
Its not entirely imminent that i switch to another savings account but obviously in the long run it would work out better.
does this explain and clear things up a bit?
thanks again :-)