Very gently, explain to a banking thicky...

Gingernutty

how maintaining high interest current accounts works.

I have one current account which I have my wages paid into (currently changing from HSBC to M&S in order to get their 6% saving rate) and I keep one current account at the Nationwide which I pay the bill money into.

There is a Loyalty Saver account at Nationwide paying a massive 0.9% net. :eek:

I am unimpressed by the interest rates offered by 'normal' savings accounts but I am baffled by all the hoops that have to be jumped through to fulfill all the conditions required by the higher interest current accounts.

I've tried sitting down and working it out, but it's like trigonometry to me.

The thread about the woman who got her SOs out of kilter and the "daisy chaining" of SOs lost me as well.

How is it done? How do you do it?

Be gentle.....:o

Herbalus

Gingernutty wrote: »

how maintaining high interest current accounts works.

I have one current account which I have my wages paid into (currently changing from HSBC to M&S in order to get their 6% saving rate) and I keep one current account at the Nationwide which I pay the bill money into.

There is a Loyalty Saver account at Nationwide paying a massive 0.9% net. :eek:

I am unimpressed by the interest rates offered by 'normal' savings accounts but I am baffled by all the hoops that have to be jumped through to fulfill all the conditions required by the higher interest current accounts.

I've tried sitting down and working it out, but it's like trigonometry to me.

The thread about the woman who got her SOs out of kilter and the "daisy chaining" of SOs lost me as well.

How is it done? How do you do it?

Be gentle.....:o

Ok, try this.

Each current account has a set of conditions attached to it. The simple answer to your question is: fulfil the conditions, and you get the interest!

Now the conditions. TSB pay the highest rate on offer (5%) on up to £2000. So every day they calculate the interest on your balance (if you have £10,000 there, you'll get interest on £2000 of it and nothing on the rest). The conditions are you have to pay in minimum £500 every month. That's it.

So you could, for example, get your wages paid into your M&S account, and then make a payment of £500 to your TSB account after this every month. Condition = tick. Interest will be paid. Now you're free to do whatever you want with your money. If it's for bills, transfer it back to nationwide, if it's for spending, transfer it back to M&S.

Santander 123 has the same £500 minimum pay in, and also requires 2x direct debits. To keep things simple, take your mobile phone contract for example, and broadband contract (or other 2 small direct debits), and change them to Sandanter. Condition = tick. Then when you pay the account £500 after your wages go in, you could pay in say £540 to cover the direct debits, leaving yourself free to transfer the £500 back.

HHarry

There are sime simple ones, and some (slightly) more complicated ones.

Bank of Scotland is simple. 3% on balances £3-5000, you just need to pay in £1000 a month. Open 2 accounts, put £3k in each and set up a standing order to swap £1000 between each account on the same day every month. Job done!
It used to be possible to do the same with TSB, but I'm not sure if you can open 2 accounts now.

Lloyds Club (4%) and Halifax (free £5) are slightly more complicated requirind Direct Debits to be set up. Start simple and work your way up!

masonic

Herbalus wrote: »

Now the conditions. TSB pay the highest rate on offer (5%) on up to £2000. So every day they calculate the interest on your balance (if you have £10,000 there, you'll get interest on £2000 of it and nothing on the rest). The conditions are you have to pay in minimum £500 every month. That's it.

That isn't quite it, because you also have to register for paperless statements and correspondence.

Gingernutty

Herbalus wrote: »

Ok, try this.

Each current account has a set of conditions attached to it. The simple answer to your question is: fulfil the conditions, and you get the interest!

Now the conditions. TSB pay the highest rate on offer (5%) on up to £2000. So every day they calculate the interest on your balance (if you have £10,000 there, you'll get interest on £2000 of it and nothing on the rest). The conditions are you have to pay in minimum £500 every month. That's it.

masonic wrote: »

That isn't quite it, because you also have to register for paperless statements and correspondence.

Done and done.

Step 1 complete.

Zanderman

Herbalus wrote: »

So you could, for example, get your wages paid into your M&S account, and then make a payment of £500 to your TSB account after this every month. Condition = tick. Interest will be paid. Now you're free to do whatever you want with your money. If it's for bills, transfer it back to nationwide, if it's for spending, transfer it back to M&S.

Plus, of course, you need to have some money left in there, to get the interest... That should be obvious, but sometimes it's not!

Ideally, to get max interest, leave £2000 in there all the time, with the extra £500 to meet the conditions going in (and out again) on top of that once a month.

Don't leave any more than £2k in there though - that would be pointless.

Gingernutty

Yup.

£2000 in there and £500 to yo-yo back and forth once a month.

YorkshireBoy

Gingernutty wrote: »

£500 to yo-yo back and forth once a month.

£500 in and £506.50 out, as you wouldn't want to leave the interest in there.

bsms1147

Gingernutty wrote: »

currently changing from HSBC to M&S in order to get their 6% saving rate

You know, HSBC also have a 6% regular saver.

Gingernutty

bsms1147 wrote: »

You know, HSBC also have a 6% regular saver.

If I hold a current account that requires £1750 per month or has a monthly fee and these conditions

HSBC Premier is available to you, as long as you pay your annual income into your HSBC Premier Bank Account and either:
have savings or investments of at least £50,000 with HSBC in the UK; or
have an individual annual income of at least £100,000 and one of the following products with HSBC in the UK:
- a mortgage;
- an investment, life insurance or protection product;

Or, qualify for HSBC Premier in another country.

Please note: HSBC in the UK excludes M&S Bank, first direct and HSBC Expat. For the second criteria, in the case of a joint account, at least one of the parties must have an individual annual income of at least £100,000. The investment, life insurance or protection products also includes those purchased through one of HSBC's advisers.

otherwise it's 4%

Sorry, that's too many hoops...

saintalan

Gingernutty wrote: »

If I hold a current account that requires £1750 per month or has a monthly fee and these conditions



otherwise it's 4%

Sorry, that's too many hoops...

THats the Premier a/c the Advance a/c only requires the £1750/m or £10500/6m