Can i 'recycle' Regular Saver Acc ?

Dubito_ergo_sum

Hi

Ive got a Regular Saver Account with First Direct @ 6% that will mature soon. I understand on its 12 months anniversary the account will stop being a regular saver and will turn into a normal savings account with a rate of 0.5% or there abouts. Once this happens, would i be able to open a new regular saver with first direct and in effect recycle the same money for 6% or is there anything in place to stop that ?

Thanks

FatherAbraham

Dubito_ergo_sum wrote: »

Once this happens, would i be able to open a new regular saver with first direct and in effect recycle the same money for 6% or is there anything in place to stop that?

No, but you can only put in £300/month into the new account, so the remaining £3300, plus the interest paid out at the end of the first account's lifespan will sit around not earning 6% interest, but whatever you can get elsewhere.

Then you'll need to make sure that £300/month gets transferred into the newly opened regular saver.

You can't get 6% on the entire £3600 for the entire year.

Warmest regards,
FA

Vortigern

Dubito_ergo_sum wrote: »

...would i be able to open a new regular saver with first direct

You should be able to open a new RS with FD as soon as the old one reaches its anniversary, but you can only pay in £300. The rest of your matured cash will have to find a new home.

Nice timing with your RS; just in time for the so-called ISA season.

Archi_Bald

Vortigern wrote: »

Nice timing with your RS; just in time for the so-called ISA season.

I reckon there is a fair chance that £300 drip fed regularly into the FD Reg Saver over the next 12 months will yield more interest than putting a lump sum of £3,600 into any cash ISA would in the same period. Even with those ISA season rates that some people still expect will be special.

Dubito_ergo_sum

Thanks.
I am about to open a First Direct ISA to transfer old ISAs from Natwest following nosediving rates, so the drip feed would be from an ISA to try and get the most interest rate though its eye watering compared to a few years ago. PS I know first directs isa isnt the most competitive but i need inet access so my options are limited. The 3600 that mature will find a home in a new post april isa if thats more competitive than the FD one.

jimjames

Vortigern wrote: »

You should be able to open a new RS with FD as soon as the old one reaches its anniversary, but you can only pay in £300. The rest of your matured cash will have to find a new home.

Nice timing with your RS; just in time for the so-called ISA season.

You can almost match the 6% reg saver with a Nationwide Flexdirect. That pays 5% on £2500 so you'll be close to that amount within the first few months anyway.

Vortigern

jimjames wrote: »

You can almost match the 6% reg saver with a Nationwide Flexdirect. That pays 5% on £2500 so you'll be close to that amount within the first few months anyway.

True, but I have both.

The FlexDirect 5% is for one year only, and the regular saver is funded from income, not from recycled savings.

planteria

you can definately open a new regular saver as soon as the existing one reaches it's anniversary.

i am on the second HSBC equivalent. if they are still offering me 6% in June/July i will have a third one too. for me it's a neat way of saving the funds to clear a credit card debt.

innovate

planteria wrote: »

for me it's a neat way of saving the funds to clear a credit card debt.

You need to explain this further. Given that credit card APRs are a multiple of the FD Reg Saver AER, and that there is no limit to how much you pay off a credit card debt anytime you like, why not put your money towards paying off the credit card debt straight away?

eskbanker

It would work if it's a 0% CC balance....