Bank Account savings for max interest

masonic

talexuser wrote: »

2500 in the Nationwide at 5% which needs £500 a month swap (external funding) and 1750 in TSB at 4.89% (does not even require external funding) for £500 a month swap back. Tesco put eg £751 for the swap. Dates all a week apart, no chance of a penalty, and the difference in interest in the 2.96 tesco extra £250 versus the 4.89 tsb is less than one £5 penalty for the whole year, with no hassle of having to check up all the time.

That's a well thought out solution. I suppose a further option is to transfer a smaller amount of money more frequently to/from the Tesco account if you want to tend towards maximum interest. I'm quite liking the four weekly standing order solution put forward by TheTracker in the other thread though. I'm not sure any of these things is likely to occur to the average person.

talexuser

masonic wrote: »

transfer a smaller amount of money more frequently to/from the Tesco account

Another good solution, I don't "think" any T&Cs specify the 500 or 750 should be in one lump sum? I suppose you could keep a £501 balance and send £250 back and forth each week for 3 different weeks without risking any shortfalls? Manually shifting ultra critical amounts is bound to come a cropper at some time or other.

masonic

None of the accounts I hold have anything in the T&Cs to prevent it (and it would be unfair to those who are paid weekly if they did). Some have opened up a few accounts starting with a small balance in each and have posted that they've done weekly transfers until they built up enough to transfer less frequently. The probability of running into a bank systems failure is higher, but if it is only the one swap being done like this, it would be easier to sort out and get a refund for charges than if a whole chain of standing orders should fail.