£60 000/Parents ??

Matty007

I did ask a little while ago and I appreciated the response, hopefully the same again !!!

Parents have got £60 000 due on the 1st August 2014.

They want an account with instance access etc and we have plumped for Santandar 1,2,3 account with a kind of feeder TSB account.

They have been accepted for three santandar accounts, one each and a joint and my Mum will have the TSB account.

They will ensure that they get the direct debits of two in each of the Santandar accounts.

My only query is the £500 needed to be paid in to every account each month.

My calculations tell me that if they kept a £2500 credit in the TSB account ( 4% ) and each month have a standing order paying in £500 to the three Santandar accounts from the TSB and then each paying that amount back to the TSB next day.

Can anyone confirm that this is the way to do it ???

Please note that I cannot open multiple accounts with the TSB my parents are already ( as I am ) finding 4 new accounts slightly challenging

Any help greatly appreciated.

Matty

kidmugsy

You could pay £125 to-and-fro every Wednesday by standing order. Then the only Bank Holidays to worry you are Xmas/Boxing Day, and New Year. Checking your diary once a year is the answer.

Nick_C

Max balance on the TSB accounts should be £2K. No interest payable above this level.

Your parents can open two TSB accounts each. At 5% gross interest, they should max these out. (They can also open two further joint accounts, but they will need to visit a branch to do this.)

Yep, set up SOs to cycle the money from Santander to TSB and back again. Also, syphon off an extra £6.50 from each TSB account for the average interest.

Max out on DDs in the Santander accounts to get the cashback. This should cover the monthly fees.

Matty007

kidmugsy wrote: »

You could pay £125 to-and-fro every Wednesday by standing order. Then the only Bank Holidays to worry you are Xmas/Boxing Day, and New Year. Checking your diary once a year is the answer.

Thanks, I am trying to work out the advantage of this.

Instead of one block of £500's paid from the accounts and then returned ?

So this would ensure no missing deadline for bank holidays each years ??

Sorry to sound dumb

Matty007

Nick_C wrote: »

Max balance on the TSB accounts should be £2K. No interest payable above this level.

Your parents can open two TSB accounts each. At 5% gross interest, they should max these out. (They can also open two further joint accounts, but they will need to visit a branch to do this.)

Yep, set up SOs to cycle the money from Santander to TSB and back again. Also, syphon off an extra £6.50 from each TSB account for the average interest.

Max out on DDs in the Santander accounts to get the cashback. This should cover the monthly fees.

Thanks, I think my parents are already uncomfortable with the number of accounts already, I might send them to an early grave if I mention another 3 TSB accounts !!!

If we have say £2000 in the TSB bring the money back to the TSB the next day, do they lose just one day of interest ??

kidmugsy

If they do it on the same date every month they'll run into days that are bank holidays or occur over the weekend. If the Santander and TSB accounts were to treat those differently they could find some difficulty. They might even mislead themselves as to how much useable balance they really have. Far simpler to pick Wednesday.

Moreover by doing it weekly rather than monthly they'd need a smaller balance in the accounts to cover the payments - this could matter in the future as their circumstances change.

It's no more work to set up a weekly Standing Order than a monthly one.

There's no need for a one-day delay. Do 'em all on Wednesday.

Matty007

kidmugsy wrote: »

If they do it on the same date every month they'll run into days that are bank holidays or occur over the weekend. If the Santander and TSB accounts were to treat those differently they could find some difficulty. They might even mislead themselves as to how much useable balance they really have. Far simpler to pick Wednesday.

Moreover by doing it weekly rather than monthly they'd need a smaller balance in the accounts to cover the payments - this could matter in the future as their circumstances change.

It's no more work to set up a weekly Standing Order than a monthly one.

There's no need for a one-day delay. Do 'em all on Wednesday.

Gottya, thanks.

Matty007

As an aside, could someone tell me why the banks have limits on the balances of those current accounts to earn the interest but then allow multiple accounts openings ?

Why not just increase the allowed balances that earn that interest ?

Nick_C

You can have all the STOs set up for the same day. Do it early to mid month to ensure payments are made/received each month.

Santander and TSB don't process STOs on weekends or BHs, they get processed the next banking day.

You don't lose any interest on the payments going in and as they all happen on the same day, and no need to go above the limits at which interest stops.

Try using First Direct Internet Banking Plus to keep track of everything!

http://www1.firstdirect.com/1/2/banking/ways-to-bank/internet-banking-plus

You don't need to be a First Direct customer to use this service. (YBS offer something similar, but I've not used it).

Archi_Bald

Nick_C wrote: »

Try using First Direct Internet Banking Plus to keep track of everything!

http://www1.firstdirect.com/1/2/banking/ways-to-bank/internet-banking-plus

I find native ewise (which provides the service to FD) a lot better than the FD service.