£20k savings Santander 123?

TonyStark_2

Hi all,

I have a little over £20k which I am looking to invest. Ideally it would be fixed for no more than 1 year. Having had a brief look around, I keep coming back to Santander's 123 account. 3% interest and easily accessible. Even in comparison to ISA's (2%) it appears to come out on top, am I missing something here?

Any advice about how I might be best investing this cash would be really appreciated!

Thanks!

Dave

bigadaj

TonyStark wrote: »

Hi all,

I have a little over £20k which I am looking to invest. Ideally it would be fixed for no more than 1 year. Having had a brief look around, I keep coming back to Santander's 123 account. 3% interest and easily accessible. Even in comparison to ISA's (2%) it appears to come out on top, am I missing something here?

Any advice about how I might be best investing this cash would be really appreciated!

Thanks!

Dave

As good as most, though nationwide pay a higher rate on a smaller sum. There a charge for the Santander account but cash back on the direct debits you have to set up so the rate can end up slightly higher or lower.

Stubod

I tried Santander a year ago, but had problems with their general crap customer service so gave up.

However I am now desperate to get decent return that is "safe", and easy access, and 3% seemed to good to miss so I tried again.

Not trouble so far, so fingers crossed.....I would recommend as there does not seem anything better at the mo. if you want a "good" return and simple access...

onlyroz

We have the 123. We mak around £9 a month cash back and then the savings interest. Setting up the direct debits was a bit of a pain because I wanted to cherry-pick which ones were used rather than transferring the lot, but we've not had any problems so far.

grizzly1911

I have two of them. Set up was a doddle, also have an esaver. Online service is good once set up. Customer service has been fine for me when contacted.

Put the council tax and energy though it and cashback soon mounts.

Don't forget you nee to fee it £500 per statement month.

ColdIron

I've got two 123s as well and can thoroughly recommend them. Santander customer service is fine nowadays and the online banking is good so you probably won't use it much anyway. 3% on £40K with cashback, what's not to like?

However I wouldn't dismiss cash ISAs entirely, rates may be low now but they won't always be. If you are a higher rate taxpayer any ISA paying better than 1.8% will beat the 123 although the 123 will be useful for the excess. Even if you're a basic rate taxpayer and want to build up a larger pot over several years, or may become a higher rate taxpayer, I would consider transferring your ISA allowance just before the end of the tax year so you can 'use it before you lose it' and make the most of both accounts

TickersPlaysPop

Wake up people!....

Can a financial expert please explain what is going on?....

1) 3% is much higher than every other UK bank, how?
2) The Santander security at login is very old fashioned, there is no password random number generator pin machine like EVERY other UK bank!

Is it a coincidence that Santander is essentially a Spanish company, in a country on the brink of becoming bankrupt ? Is Santander soaking up the UK market to capitalise itself?

I was affected by the ICICI mess when the markets/ banks crashed and didn't have access to my money for mths and spent the whole time worrying if the FCS was going to work. So I am a little concerned about the Santander wonderland 3% deal....

Am I the only person thinking this?

Peace

innovate

TickersPlaysPop wrote: »

Wake up people!....

Can a financial expert please explain what is going on?....

1) 3% is much higher than every other UK bank, how?
2) The Santander security at login is very old fashioned, there is no password random number generator pin machine like EVERY other UK bank!

Is it a coincidence that Santander is essentially a Spanish company, in a country on the brink of becoming bankrupt ? Is Santander soaking up the UK market to capitalise itself?

I was affected by the ICICI mess when the markets/ banks crashed and didn't have access to my money for mths and spent the whole time worrying if the FCS was going to work. So I am a little concerned about the Santander wonderland 3% deal....

Am I the only person thinking this?

Peace

You need to get your facts straight.

Santander isn't the only UK bank that pays 3% interest. There are 3 others that pay the same, and one Building Society that pays 5%.

What is a "password random number generator pin machine"? Do you mean a card reader? If so, you need to, again, get your facts straight. Not all UK banks require a card reader. And none needs a "password random number generator pin machine".

Santander UK is a UK plc like any other UK plc. It is also covered by the FSCS guarantee like any other UK regulated and authorised financial institution.

What ICICI mess were you affected by? Do you mean the ICESAVE one? ICICI never needed FSCS intervention.

Freecall

You need to be careful with the age of information about Santander.

It did go through a period of difficult customer service around the time that it was trying to integrate the systems of Abbey National and the like during a time of extensive acquisitions.

Nowadays though I would say that it's customer services are about as good as banks are in general.

bigadaj

Now I really want a password random number generator pin machine, where can I get one?

JustAnotherSaver

To respond to the original question -

If you're going to use the direct debit cashback that Santander offers (phone bills, council tax etc etc) then i'd go for the Santander myself as this should pay off the £2pm fee & you still get 3% interest.

If not having the direct debits on the account then i'd probably opt, initially for Nationwide with their 5% on £2.5k & then the rest in either Lloyds TSB (or whatever they're calling themselves these days) in one of their Vantage accounts at 3% no charge, or HBOS i think the other is for the exact same.

First option would be to stick money where it works hardest (Nationwide 5%).