Making the most of a 2K lead mp sum

Tammy2

Much to my surprise I have been accepted for a TSB Classic Plus Account (5% interest).

So, I plan to circulate my 2K in and out of this account - £500 in and £510 out a month (to account for interest).

But my other account pays very little interest. Would it be worth trying to open another high interest current account, even though I only intend to be 'down' on the max for a day (out one day and back in the next)?

bowlhead99

No.

If you are slightly down for one day every month, you are getting one thirtieth less interest on that 500. At a market-leading 5% a year (e.g. Nationwide), the total interest on 500 for a year is £25. So a thirtieth of that is 83p. For a year.

If you don't need another high interest account you are insane to open one for 83p (before tax).

One solution is to simply move the money in and out same day. But for 83p a year (7p a month) it probably isn't worth you thinking very long on it (nor me replying to it )

JohnRo

The interest won't ever amount to £10 a month.

It's closer to £6.66 pcm (average) after BRT assuming the full £2K is maintained.

My February interest credit was £6.00 per account.

Tammy2

Thought so, but thought I'd check - I'm rather enjoying the new money saving me