NISA or Santander 123?

Edelman

I've just gone thru the '123' calculator. If I were to put £17k into a bank account, and all my bills went thru it too, it would earn me roughly £550 a year.

Would *ANY* NISA give me that on my savings.... and me able to access it....?

Herbalus

No.

You don't even need to do the calculations to see how much you'd get.

Santander 123 is 3%, so 2.4% after basic rate tax. No easy access ISA comes close.

Edelman

Sorry what do you mean?
So that '123' deal is better than most NISAs?

Cornucopia

Better than all instant access ISAs.

Edelman

So is it a no brainer?
You can put in up to £20k, you get cashback on most bills, it's higher than NISAs. Is there a better deal out there, if u have cash to tuck away and want access to it ... ??

grumbler

Edelman wrote: »

Sorry what do you mean?
So that '123' deal is better than most NISAs?

It's not a rocket science. Just compare the interest rates as the cashback on your bills is pretty much irrelevant.

>> Cash NISAs

Edelman wrote: »

... Is there a better deal out there, if u have cash to tuck away and want access to it ... ??

>> Top Savings Accounts

Herbalus

Edelman wrote: »

So is it a no brainer?
You can put in up to £20k, you get cashback on most bills, it's higher than NISAs. Is there a better deal out there, if u have cash to tuck away and want access to it ... ??

Well, no it isn't a no brainer. You do have to think about it, read the T+Cs, and make sure you transfer £500 in every month. And you have to consider the impact of £2/month fee, which is negligible but some people don't like it.

And yeah, there are tonnes of better deals out there, all with their own hoops.
Nationwide @ 5% on £2500
TSB @ 5% on £2000 x2
Lloyds Club @ 4% on £5000

But that depends on how many bank accounts you want to open. If you just want one place, go for Santander.

Edelman

I have a current account with a really rubbish rate.
I have an ISA with just 0.5% Gross with a good amount in it.
In theory, I could chuck the lot into a 123 account, and earn far better interest than any of them!

I don't want multiple accounts. Too complicated to manage.

But I'm surprised this is better an most NISAs.

Cornucopia

The banks no longer need our capital - they get a better deal from the Government.

The current account offers are about market share. And although some of them have been running for several years, I wouldn't expect them to last indefinitely.

Santander was one of the first, and I expect it to be last man standing. If for no better reason than "123" is a simple and straightforward marketing message.

datostar

I moved funds out of a Santander ISA paying 1.7% into my 123 account to get it up close to the £20,000 to maximise the 2.4% after tax interest and now dripfeed £1250 a month into the Nationwide Regular Saver ISA paying 2.5% tax-free, topping up the 123 with new savings money. I temporarily lose tax-free status but I can live with that for the extra interest.

brewerdave

I've opened a Santander fixed 2 year ISA @ 2.3% for this tax year which I've filled to the pre July 1st allowance (£5940) -the debate I'm now having with myself is whether I trust Santander to maintain the 3% gross on our current account for at least the next two years(currently ~ £20k in it)...or whether to top the ISA up to £15k in case the bankers drop the 123 interest rate...decisions,decisions....;)