Savings Account or ISA?

DiNZi

Hi all,

I'm new and hoping I can get some advice on my banking queries.

At the moment I've got a Halifax Guaranteed Saver account, there is in the region of £12k in there at the moment. My salary gets paid into a Santander Visa Debit account, and every month I take some and move it into the Guaranteed Saver.

I have no idea what the interest rate is on the Halifax saver account. Halifax are making some changes and I have received a letter, they will be withdrawing the old savings card.

I'd like to make some changes as well.

They recently sent me a letter '£200. Just for you when you switch to our reward current account'. I will continue with the same system of moving at least £700 into a account, which with your advise can help me get the best interest rate.

I think the interest rate on this rewards account is 1.51%, is this a good option? Can I do better moving to someone else?

I just want to put my savings into an account, where I'll continuously pay in at least £750 every month and get a good interest rate on this. I want to be able to access it online, withdrawal is preferable but not a must.

enjoyyourshoes

MSE website will give you different options from best interest on current account, savings and ISA's. It will also provide you with the different conditions for each account that must be met.
Lloyds Club
TSB
Santander to name 3 may be applicable &/or mixture 3. (based upon rates)
But some accounts offer £'s to swith, and MSE will go thro the best there.
Could also investigate Stock and shares Isa and Private Pensions (& SIP's) to give you a more rounded view on how you may want to use your money

DiNZi

enjoyyourshoes wrote: »

MSE website will give you different options from best interest on current account, savings and ISA's. It will also provide you with the different conditions for each account that must be met.
Lloyds Club
TSB
Santander to name 3 may be applicable &/or mixture 3. (based upon rates)
But some accounts offer £'s to swith, and MSE will go thro the best there.
Could also investigate Stock and shares Isa and Private Pensions (& SIP's) to give you a more rounded view on how you may want to use your money

Do you think it's worth me putting my money into an ISA or NISA account rather than a savings account?

CLAPTON

DiNZi wrote: »

Do you think it's worth me putting my money into an ISA or NISA account rather than a savings account?

an ISA is a saving a/c (assuming you mean a cash ISA)




with only 12k you are best putting it in the account with the best net of tax rate;
currently you can get 3% with a Santander 123 current a/c up to a max of 20,000 : this is equivalent to 2.4% after 20% tax or 1.8% after 40% tax (there are conditions attached)


read the main sectors on savings and current accounts.

DiNZi

CLAPTON wrote: »

an ISA is a saving a/c (assuming you mean a cash ISA)




with only 12k you are best putting it in the account with the best net of tax rate;
currently you can get 3% with a Santander 123 current a/c up to a max of 20,000 : this is equivalent to 2.4% after 20% tax or 1.8% after 40% tax (there are conditions attached)


read the main sectors on savings and current accounts.

I see what your saying, looks like a good idea to start. I'll close the Halifax Guaranteed Saver.

I've got around £12-15k I think, I'll move that into the 123 account, and get 3% interest as long as I move at least £500 into the account every month. I suppose for that interest rate, £2 a month is a small price to pay.

Any idea how often interest is paid out monthly or annually?

CLAPTON

DiNZi wrote: »

I see what your saying, looks like a good idea to start. I'll close the Halifax Guaranteed Saver.

I've got around £12-15k I think, I'll move that into the 123 account, and get 3% interest as long as I move at least £500 into the account every month. I suppose for that interest rate, £2 a month is a small price to pay.

Any idea how often interest is paid out monthly or annually?

you need to set up two DDs


interest on 20,000 would be :
20,000 x 3% /12 = £50 per month gross
assuming 20% tax means 50 x 80% = £40 per month

badger09

DiNZi wrote: »

I see what your saying, looks like a good idea to start. I'll close the Halifax Guaranteed Saver.

I've got around £12-15k I think, I'll move that into the 123 account, and get 3% interest as long as I move at least £500 into the account every month. I suppose for that interest rate, £2 a month is a small price to pay.

Any idea how often interest is paid out monthly or annually?

All explained here, which you should read before you sign up;)

http://www.santander.co.uk/uk/current-accounts/123-current-account

DiNZi

CLAPTON wrote: »

an ISA is a saving a/c (assuming you mean a cash ISA)




with only 12k you are best putting it in the account with the best net of tax rate;
currently you can get 3% with a Santander 123 current a/c up to a max of 20,000 : this is equivalent to 2.4% after 20% tax or 1.8% after 40% tax (there are conditions attached)


read the main sectors on savings and current accounts.

I phoned Halifax, that rewards current account is pretty crap, you get £200 when you switch and then £5 every month with the same terms as Santander 123, at least 2 DD's, £750 in the account every month. So that's £5x12 (year) + £200 = only £260 for the year. You get no interest on the money that's in the account.

If I go with the Santander 123, and hold the £15,000 in there and get 3% on that amount plus keep adding, I can get extra with this account.

Hey, what do you mean by 20% and 40% tax? I suppose over a certain amount the tax doubles.

colsten

DiNZi wrote: »

I phoned Halifax, that rewards current account is pretty crap, you get £200 when you switch and then £5 every month with the same terms as Santander 123, at least 2 DD's, £750 in the account every month.

terms for the 123 and Halifax Reward are not the same. At best, they are similar.

DiNZi wrote: »

So that's £5x12 (year) + £200 = only £260 for the year. You get no interest on the money that's in the account.

That's £260 more than if you didn't switch, and didn't make sure you get the monthly fivers.

DiNZi wrote: »

If I go with the Santander 123, and hold the £15,000 in there and get 3% on that amount plus keep adding, I can get extra with this account.

this is true, but why make it an either or? Many people here have the Halifax Reward alongside their other current account(s), simple for the fivers.

DiNZi wrote: »

Hey, what do you mean by 20% and 40% tax? I suppose over a certain amount the tax doubles.

your tax rate depends on your total income, incl any interest from savings.

DiNZi

colsten wrote: »

terms for the 123 and Halifax Reward are not the same. At best, they are similar.

That's £260 more than if you didn't switch, and didn't make sure you get the monthly fivers.

this is true, but why make it an either or? Many people here have the Halifax Reward alongside their other current account(s), simple for the fivers.

your tax rate depends on your total income, incl any interest from savings.

I see what your saying, unfortunately both require you to have 2 direct debits each. I only pay 2 direct debits in the house.

So, at the moment, I think the Santander 123 is the best option. When I take up more direct debits, I'll look again at current offers.

DiNZi

As I will use the Santander 123 account to put in the £15k and lose the Halifax account as I won't need it.

I used to have two cards, so a Santander normal bank account no interest ect.. I just put £200-500 in there from my salary to spend on anything I need in the month and the rest of the salary goes into the Halifax Guaranteed Saver account.

I'm now losing the Halifax account, so the £15k and anything from my salary will go to the Santander 123.

I'm not going to have 2 Santander accounts, so I'll ask them to close the current card I've got with them at the moment too.

I'll then open an account with another bank, is there any good bank accounts that offer interest if you hold x amount in the account and say transfer £400 into that account every month?

Probably won't get interest on such a small amount in the account but worth asking.

I do like the look of the Lloyds Classic Current account, nice card too lol!

Basically aim is to have two accounts. 1st that acts as a saving account which I add £800+ to it every month and I want to gather interest on the amount in the account every month. 2nd that I keep at least £500 in there for monthly spending if I need it, but if holding £3000-5000 in there without having to always put more than £300 gets me interest I can do this.