Best way to use TSB account

dave76

I have just switched to TSB for their nice 5% on up to £2k and taken over about 400 quids worth of direct debits. I guess the best way to use it for now is never let it go under 2k - pay in 500 (min monthly payin) beginning of the month and take out whats left over 2k at the end of the month?

grumbler

Define "best".

The really best way (but time consuming) is to top the account up to £2K after each DD and credit extra ~£100 at the start every month only to transfer it back to another interest-paying account together with the interest.

That said, Santander 123 can be a better account for many DDs.

xylophone

Unless you are required to have DDs on the TSB, my inclination would be not to have them there.

Do you have another account for the DDs so that you can simply keep the £2000 in TSB and set up a SO to send £500 a month to the account?

You can take it out again when you pick up the monthly interest to send elsewhere?

It might be worth looking at the 123 account - I have only fairly recently obtained one and wish I'd done it earlier.

jimjames

I'd echo the comments above but to be clear, I'd open a Santander as well as TSB. Otherwise you'll be in danger of getting very little interest as rate below £3000 is lower.
For my TSB I pay in £500 at start of the month and a few seconds later I transfer it back out again along with the interest.

TarkaDal

DD are not needed on the TSB or Nationwide Flexdirect accounts.

My two TSB accounts give 500 each to my Nationwide account, which gives 500 back to each TSB account on the 1st of every month. I then move the interest into a different account.

shortcrust

My TSB classic plus accounts are just used as savings accounts so it's simple. I transfer 500 in and straight back out again and I move the interest out when it's paid. The balance of each is nearly always bang on 2000.

Nebulous2

I mix it up a bit, just because I have seen people claim accounts get closed where not used properly. (That wasn't TSB)

So I pay £1000 in some months then immediately move it to Nationwide. Other months I pay £500 in and move it to Nationwide. Occasionally I pay £500 in and pay some bills with it, often a payment to my credit card.

I don't have any direct debits.

Interestingly TSB appear to assume I'm not very solvent. I have some high limit, prime credit cards from other companies but any offers I get from TSB appear to be high interest ones with fairly limited extras.