A&L vs Lloyds vs Citibank

houmie

Hello,

I am thinking about transfering my current account from HSBC to Alliance & Leicester 5% on 25000. Martin's recommendation is however for a higher salary to go with Lloyds TSB, since it pays 4% on 5000. For those even higher Salary should Citibank direct 4.5% on everything be the better choice.

However I don't see the point; why should I have 5000 on my current account for 4% or 4.5% when I can put it into Saving account of Alliance & Leicester for 5.35%? There shouldn't be anyway more than 2000 on the current account just for emergencies. So isn't Alliance & Leicester in this case the best bank for Saving account and Current account?

cheers
Houman

jimclark1967

Because if you have a higher salary your account would have more than £2500 in it every time you get paid.

Granted that'd be a nice "problem" to have :rolleyes:

houmie

Hmmm, I see. ;o)

My monthly salary won't go over 2500 though. I guess A&L is the winner then.

Thanks
HOumie

MarkyMarkD

I don't think Martin's logic is right, though. If you have your finances arranged properly (and I do!) then all your DDs will leave the account on payday or immediately thereafter. So even if your salary credit is £5,000, the balance will stay below the limit due to the DDs.

In any case, if you have the A&L account and DO get £5,000 a month credited (and if so, you are lucky!) you can transfer the surplus out to Online Saver same day and back a day before it's required to meet expenses.

So houmie's conclusion is right - but it would also be right for many people who are high earners if they are prepared to organise things properly.

sly_dog_jonah

MarkyMarkD wrote:

I don't think Martin's logic is right, though. If you have your finances arranged properly (and I do!) then all your DDs will leave the account on payday or immediately thereafter. So even if your salary credit is £5,000, the balance will stay below the limit due to the DDs.

I got stung this week though when payroll screwed up and only paid basic salary, and didn't pay overtime or expenses. My DD sweep to a savings account exceeded my actual pay by over £300, so if i get charged for exceeding my agreed overdraft limit I am going to charge the company for it (after trying to negotiate with the bank, after all my girlie was able to pay cash into my account on the same day as the DD went out to bring me back into my agreed limit).

MarkyMarkD

sly dog,

I would NOT set up a standing order payment to move money on payday to a savings account - what's the point? You can transfer the relevant amount on the same day by a transfer you set up on payday, which avoids the risk of the amount not being what you expect (or you needing a bit of extra cash in the current account for whatever reason).

Jane.tweedynn

MarkyMarkD wrote:

I don't think Martin's logic is right, though. If you have your finances arranged properly (and I do!) then all your DDs will leave the account on payday or immediately thereafter. So even if your salary credit is £5,000, the balance will stay below the limit due to the DDs.

In any case, if you have the A&L account and DO get £5,000 a month credited (and if so, you are lucky!) you can transfer the surplus out to Online Saver same day and back a day before it's required to meet expenses.

So houmie's conclusion is right - but it would also be right for many people who are high earners if they are prepared to organise things properly.

I concur. Martin should make people aware of the values involved and the benefits for the average person to arrange debits and credits around the same time.

I moved 8 months ago to A&L from Barclays but this change your current account to an high interest paying account has been around with the Halifax for some time with claims of 20x interest to the big four banks. I just laugh.

Although you can now get 50x interest with A&L, its still hardly worth it. If someone has a £200 average balance over the year on their account then this would give an extra £8 in interest a year. Hardly worth the effort of the change and if you do have more then why is this not in a high interest saver.

If people arranged all their payments a couple of days after their Salary they would know exactly how much they had left to spend in the month so they could transfer any savings/short term money to an higher interest account.

The A&L current account coupled with the Internet Saver is the best package around at the moment with transfers between the accounts being instant and you can view both accounts on the same screen with just the one logon.