What to do with £3k

prodda

I recently received notification from Santander telling me that the interest rate on my savings account (originally opened with A & L) was being reduced from 2.3% TO 0.5%

As my ISA allocation for this year is full, I have transferred my Santander current account into a 123 account & put most of the money from the ex A & L account into it so it's on or about the £20k interest limit.

This leaves me with £3k remaining in the ex A & L account and I'm not sure what to do with it. Should I leave it there or should I just put it into the 123 account (where I won't receive any interest on it)? I thought about opening an FD account or something like that but wouldn't be able to service it with a monthly deposit, as I'm currently having to do that with my 123 account.

Any thoughts would be greatly appreciated.

xylophone

Open a Flexdirect with Nationwide and recycle the required £1000 through your other account?

http://www.nationwide.co.uk/current_account/flexdirect/default.htm?intcmp=Intcmp_1967

bowlhead99

Given you have almost 20k of cash sitting in Santander plus 3k more I can't see how you would struggle to find enough money to "service" a FD or Nationwide or Lloyds account.

Hint: the same 1k or so can probably provide a monthly deposit to all of them. Once you have accounts with more than one banking group it is very easy to credit any of the accounts with at least £1k from an account outside the group to meet terms and conditions...

So, it would be ludicrous to have it sat in Santander 123 for zero interest or in the ex A & L account earning a nominal amount, unless you reeeally want to do Santander a favour.

AndyPK

Lloyds or another Santander 123 account.

slinga

xylophone wrote: »

Open a Flexdirect with Nationwide and recycle the required £1000 through your other account?

http://www.nationwide.co.uk/current_account/flexdirect/default.htm?intcmp=Intcmp_1967

Looks interesting.

Can you open more than one account similar to LTSB Vantage?

And for AndyPK why not buy whatever you would have bought as an ISA but without the ISA wrapper.
Then next April transfer it to an ISA.

ColdIron

If you open an e-saver with First Direct at the same time as the First Account and put a pound in it, it waives the monthly funding requirement

Archi_Bald

slinga wrote: »

Can you open more than one account similar to LTSB Vantage?

From http://www.nationwide.co.uk/current_account/flexdirect/FAQs.htm

You can open up to four Nationwide current accounts, however you are only guaranteed the 5% AER promotional interest rate on one FlexDirect account.

elektra

prodda wrote: »

I recently received notification from Santander telling me that the interest rate on my savings account (originally opened with A & L) was being reduced from 2.3% TO 0.5%

Received one of these as well and was really surprised to see the rate at 2.36% as I last used account in 2009 (never got round to closing it) so how come the rate didn't drop ? At the time it looks like I transferred it to a higher paying A&L.

I could have been receiving a little better rate than my Santander Esaver 1.25%. Before you say I could get better elsewhere - I have already have TSB/BOS etc - this is just used for excess and instant transfer to current account.

I guess I forgot as there were always better paying rates around and Santander don't display the intrest rates for each account when you log in.

Edit: found the answer on another thread

ses6jwg wrote: »

The two groups majorly impacted are those with the old A&L e-savers which had a variable base rate of around 2 to 2.3% gross, as well as a couple of long defunct Bradford and Bingley accounts which were 1- 1.5% gross.

Vortigern

ColdIron wrote: »

If you open an e-saver with First Direct at the same time as the First Account and put a pound in it, it waives the monthly funding requirement

That's true, but the FD referenced in this thread is the Nationwide FlexDirect (probably)