Moving some cash advice

NotRichAtAll

i have x2 tsb accounts the ones that give the 5% interest 1 of these is full 2k the other is only partially full.
i have a santander 123 account my working account wages bills etc and surplus cash at the moment this has 8.5k in it

with regard to the monthly interest would i be better off topping up the partially full tsb account or would the difference in monthly interest not warrent the movement of the cash?

if i moved the cash i would have

x2 tsb 2k @ 5|%
x1 santader123 6.5K (variable as working account) @ 3%

if i left the cash as it is i would have

x1 tsb 2k @ 5%
x1 tsb £100 @ 5%
x1 santander123 8.5k (variable as working account) @ 3%

the rest of my cash is happy where it is.
calculating interest rates etc is not my strong point hence my post

thanks

SalarySlave

Yes it would be beneficial to fill both the 5% paying accounts first as these have the higher interest rates.

letThemPlay

Scenario 1 having both TSB filled will lead you to be about £2.26 better off per month. These calculations are only rough as they are averaging out across the year; wheras each month will be different depending on the number of days.

Scenario 1 ((amount * gross interest rate) * tax rate) / 12
2 x 2K @ 5% = ~ £13.04 pm ((4000 * 0.0489) * 0.8) /12
6.5K @3 = ~ £12.83 pm ((6500 * 0.0296) * 0.8) /12
Total = ~ £25.87 pm

Scenario 2
2.1K @ 5% = ~ £6.84 pm ((2100 * 0.0489) * 0.8) /12
8.5K @ 3% = ~ £23.61 pm ((8500 * 0.0296) * 0.8) /12
Total ~ £23.61 pm

I hope this helps

Eco_Miser

You don't need to do any complicated calculations, just answer the question Is 5 bigger than 3?. It is, so fill your 5% accounts.



If doing this would drop your Santanter balance below £3000, the loss of interest on the remaining balance could change that, but that's not going to happen in your case.

Transferring from one account to another has virtually no cost, so whichever scenario returns the most money is the one to go for.

NotRichAtAll

thanks for all the replies