Regular Savings Accounts: The Best Currently Available List!

Special_Saver2

I have updated the first post of this thread by adding the following comment to the two Abbey monthly savers.

11/08/07: Note that several money savers report that Abbey are not sticking to their own terms and conditions on their past regular savings account. They are maturing these accounts 1 month earlier than they should and people's 13th payment is being returned. See this thread.


As for the question above about the Lloyds TSB regular saver, I am lucky that I have never needed my money back but I presume that you could just withdraw the money directly over the counter at any branch. I don't remember seeing anything in the terms and conditions saying that you had to transfer the money. Even if that were the case, you could just go to any branch, transfer the money to your current account and withdraw it from there straight away. So don't worry - either way, you can just go to a branch and withdraw the cash straight away.

Actually, I have just logged in to their online banking system and you can transfer the money online into your current account (or into your online saver account if you have one) at any time if you wanted to do that.

Christal_2

I have to agree the Lloyds TSB regular saver is a good one, it is paying 8% as long as you don't make any withdraw, if I remember correctly, once you make a withdraw, the interest of that month will be gone. (not for the amount you withdraw, but for all money in the account)

The catch is you do have to have a current account with them, which was fine with me as I already have one.

But I have to admit that regular saving accounts only make sense if you start from scratch, if you already have a pot of more than 10K to start with, then you are better off to put them all in to one feeder account which pays good rate, like Sainsburry for example.

Aerodiver

Christal wrote: »

I have to agree the Lloyds TSB regular saver is a good one, it is paying 8% as long as you don't make any withdraw, if I remember correctly, once you make a withdraw, the interest of that month will be gone. (not for the amount you withdraw, but for all money in the account)

Nope, not true. Its better than that. No penalties, as many withdrawals as you like. You won't lose any interest. Only restriction is that you can only add £250 each month, so if you make many withdrawals you won't have as much dosh in the account earning 8%.

oldfella

But I have to admit that regular saving accounts only make sense if you start from scratch, if you already have a pot of more than 10K to start with, then you are better off to put them all in to one feeder account which pays good rate, like Sainsburry for example.

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dont understand this logic - I run both normal and RS, putting as much as I can each month into several RS. Higher interest is good !

The_Fiddler_2

Aerodiver wrote: »

Nope, not true. Its better than that. No penalties, as many withdrawals as you like. You won't lose any interest. Only restriction is that you can only add £250 each month, so if you make many withdrawals you won't have as much dosh in the account earning 8%.

Do you still have to take out a current account?

Is it true you don't actually need to put anything in this account?

Kazza242

The_Fiddler wrote: »

Do you still have to take out a current account?

Is it true you don't actually need to put anything in this account?

You do still need to open a LTSB current account. You can just keep £1 in the current account.

Christal_2

Thanks Aerodiver, you are totall right on that one. It was opened more than half year ago and I don't make any withdraw so has forgot the terms.......

Oldfella, what I mean is if you have say a pot of £10K, then if you can put it all in one high interest rate feeder account for a year, the interest you get will be more than what you can get by putting 250 or 500 to one of those RS account each month........all you need to do is calculate how much interest you can get by putting the money into one feeder account, and then compare with the total interest you will get to put same amount of money into a RS account, but in 12 installment.......the result will be interesting.

Of course, if you also have monthly income, then you should have both accounts, the big pot in the feeder one to start with, and the monthly income to the RS account to get as high interest as possible.

oldfella

Oldfella, what I mean is if you have say a pot of £10K, then if you can put it all in one high interest rate feeder account for a year, the interest you get will be more than what you can get by putting 250 or 500 to one of those RS account each month........all you need to do is calculate how much interest you can get by putting the money into one feeder account, and then compare with the total interest you will get to put same amount of money into a RS account, but in 12 installment.......the result will be interesting.

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all the money in one pot
£10K at 6% = £600

or
use a feeder account to serve a RS

the feeder account has an average of £8.5K at 6% = £510
plus
the RS has an average of £1500 at 8% = £120... total £630

Christal_2

oldfella wrote: »

all the money in one pot
£10K at 6% = £600

or
use a feeder account to serve a RS

the feeder account has an average of £8.5K at 6% = £510
plus
the RS has an average of £1500 at 8% = £120... total £630

Oldfella, I think when you consider you put that 1500 into a RS account over several months (as I understand most RS usually only allows 500 or 250 monthly payment, so you can't pay in all 1500 at once), the interest will not simply be 1500 X 8%, as your monthly account balance changes.

The main reason I recommend the Feeder account if you have a big pot to start with is because there is less restriciton on how much money you can put in at once, which means all your money can earn interest immediately from day one. But with RS account, you can only put in certain amount each month, so some of your money will have to sit in a lower interest account to wait.

Say you start with the Lloyds TSB RS account which pays 8% and you can pay in a total of 3500 in a year, you will only earn interest of 170 over the year.

But if you put all 3500 into the Sainsbury's account which pays 6.25% at once, over the year you can earn interest of 218.

Joscar

I think you are still missing something here - no offence.

Oldfella's example of £1500 is an average over the year not a one off payment, ie £250 x 12 monthly instalments is an average balance of £1500. He is trying to simplify the maths to explain that if you start off with £10,000 in an account that pays 6% and drip feed £250 a month in to a 8% RS account (therefore over the year the average balance is £8,500) then when you add together the interest from both accounts you are better off.

If I have not explained this well enough please go back to Martins original explanation in his article.