Quick question regarding Santander 123 accounts

guymo

chris9393 wrote: »

Now for the interest on the 123 account do I need to keep £20,000 in there for a whole year or could I just put it In then take it back out?

You will receive interest monthly based on the daily balance in the account, so if you put your £20k one day and take it out the next you'll get just over a pound at the end of the month, and be charged £2 for the account; if you leave it all year (and meet the other criteria) you'll get £480 (net of base rate tax), with £24 in charges.

BookerTee

Archi_Bald wrote: »

you are now only allowed 1 sole and 1 joint account.

Rats I knew I should have opened a second account :mad:

Actually I need to correct my earlier statement I only have space for £72,500...!

chris9393

So it will be best to just leave £20,000 in there then.

Now comes the confusing part, I'd prefer to carry on using my Halifax account as my 'current' but move all my DD's over to the new 123 account. To be on the safe side I'd also change my bank details at work so il automatically get paid in the new account.

I could then set up a standing order from the 123 account to automatically pay back into the Halifax and FlexDirect.

Is it just as 'simple' as this? Moving funds around to qualify.

BookerTee

I think you only need funds to stay in the account for 24 hours to qualify before moving them on.

eskbanker

BookerTee wrote: »

I think you only need funds to stay in the account for 24 hours to qualify before moving them on.

24 milliseconds would work just as well! They're not interested in how long the money stays in, it's the fact that it's being paid in in the first place that's the key measure.

However, aside from meeting minimum monthly funding requirements, someone with a 123 plus a Halifax Reward and a Nationwide FlexDirect would benefit from keeping the FlexDirect funded as close as possible to £2,500 for the 5% interest, then the 123 as full as possible for 3% and only then put money in the Halifax one....

BookerTee

eskbanker wrote: »

24 milliseconds would work just as well!

Have you tested this? I have heard others say they have lost a months interest because it hadnt been in the account for 24 hours!

My intention was to take the £1000/500 out of the account just before paying the same amount in.

innovate

There is no prescribed time any money has to stay in the account.

Anyone claiming they weren't paid interest because they didn't leave the minimum monthly payment in the account for 24 is confused. Naturally, you will not receive any interest on money that is not in the account when they run their daily interest calculation, which is usually late at night.

However, this is totally different to whether you have met the condition of having paid in your monthly £500. You either have or you have not, it is a binary answer, and it is not dependent on how long the £500 was in your account.

eskbanker

BookerTee wrote: »

Have you tested this?

Yes - I pay money monthly into my 123s manually via faster payments, then immediately log into Santander online banking and transfer it straight back out again. Not literally milliseconds I suppose but no more than a couple of minutes. This can all be done automatically with standing orders but I prefer to do it manually.

BookerTee wrote: »

My intention was to take the £1000/500 out of the account just before paying the same amount in.

In which case you're effectively talking about the money being in for a negative amount of time, proving the point nicely that it really doesn't matter how long it's in for (as far as meeting monthly funding requirements is concerned, obviously the interest calculation can be affected as per innovate's post).