What is the Highest Interest Rate / Cashback / Rewards You Can Get?

Groat

Just read through the whole thread. That is a lot of information to take in x__x

I've been with Natwest for over 10 years and I'm a little tired of their terrible rates and service, so thought I would take a look at better options. Currently I have £30k to save (earning a meagre 0.5% AER), and will be saving an additional £2k/month.

My first step is to open a Halifax Help to Buy ISA of course, but then comes the fun of arranging an optimal set of bank accounts to maximise interest. I see lots of places with much higher interest, but I'm not really sure where to start!

Robbieh

Groat wrote: »

Just read through the whole thread. That is a lot of information to take in x__x

I've been with Natwest for over 10 years and I'm a little tired of their terrible rates and service, so thought I would take a look at better options. Currently I have £30k to save (earning a meagre 0.5% AER), and will be saving an additional £2k/month.

My first step is to open a Halifax Help to Buy ISA of course, but then comes the fun of arranging an optimal set of bank accounts to maximise interest. I see lots of places with much higher interest, but I'm not really sure where to start!

I started with the 5% accounts first! the ones not needing DD's just till I got my head around the monthly payins and the actual act of opening accounts. It was a bit daunting at first having been with the same bank with one account since 1982! With the help of excellent people on here I'm now in the swing of it with 10 accounts and 3 Reg. Savers all doing way better than the funds stuck in premium bonds!! I think the good accs. to start with are TSB and Nationwide ( for one year) no DD's and Reg. saver options.

All the best.

w1ntermut3

Thinking about it, could you open a duff current account e.g. Tesco, then use a switching service to close THAT account and open either a Halifax Reward or a First Direct for the bonus and/or saver?

colsten

These sorts of accounts are referred to as 'donor' accounts here, and yes, people do use them.

w1ntermut3

Thankyou.

As a second question - if you use a switching service does it just close that ONE account nominated or all of your account with a given bank?

eskbanker

w1ntermut3 wrote: »

if you use a switching service does it just close that ONE account nominated or all of your account with a given bank?

Just the one account.

Jhoney_2

Hi all,

Firstly, thanks to Specialsaver, Yorkshireboy, colsten and the many others whose contributions given much much appreciated advice about how to save in a proactive manner!

I have also had one bank account for way too long (80's)and am swatting up through the forum and this thread on what I need to do.

As a starting point, I have chosen to use the following accounts:-

2 x Tesco @ 3% up to 3K
1 x FlexDirect @ 5% up to 2.5K and £1000 pay in requirement -
1 x Flexclusive RS 5% up to £500pm deposit allowed
1 x TSB Classic Plus@ 5% up to 2K, £500 pay in requirement
1 x Regular Saver 5% up to £250pm deposit

What I don't understand is how to move around the money as per the 5% loophole article?

I read Specialsavers posts about good feeder accs and a post on this thread also reminded me that it would be a good idea to use the Tesco in this scenario as the feeder to the other accounts to have them earning interest while it feeds the others- Ashamed to say it would never have occurred to me but it certainly makes sense. Then what?

Once I get the hang of it, I will add more accounts, but I may be applying for a mortgage this year and do not want to go to far on the applications. I have declined the overdraught options to minimise the hard searches where applicable - I don't mind having them, but rarely use it so not a big compromise.

The article suggests fillng the Tesco accounts first - and then I got confused. Any suggestions appreciated. Try as I have, I am getting nowhere with planning this...

Thanks

ratechaser

Jhoney wrote: »

Hi all,

Firstly, thanks to Specialsaver, Yorkshireboy, colsten and the many others whose contributions given much much appreciated advice about how to save in a proactive manner!

I have also had one bank account for way too long (80's)and am swatting up through the forum and this thread on what I need to do.

As a starting point, I have chosen to use the following accounts:-

2 x Tesco @ 3% up to 3K
1 x FlexDirect @ 5% up to 2.5K and £1000 pay in requirement -
1 x Flexclusive RS 5% up to £500pm deposit allowed
1 x TSB Classic Plus@ 5% up to 2K, £500 pay in requirement
1 x Regular Saver 5% up to £250pm deposit

What I don't understand is how to move around the money as per the 5% loophole article?

I read Specialsavers posts about good feeder accs and a post on this thread also reminded me that it would be a good idea to use the Tesco in this scenario as the feeder to the other accounts to have them earning interest while it feeds the others- Ashamed to say it would never have occurred to me but it certainly makes sense. Then what?

Once I get the hang of it, I will add more accounts, but I may be applying for a mortgage this year and do not want to go to far on the applications. I have declined the overdraught options to minimise the hard searches where applicable - I don't mind having them, but rarely use it so not a big compromise.

The article suggests fillng the Tesco accounts first - and then I got confused. Any suggestions appreciated. Try as I have, I am getting nowhere with planning this...

Thanks

Excel is your friend here. Over the past month, I've opened up 7 'donor' current accounts, 11 'real' current accounts, 2 tesco savings accounts, and another 5 linked savers (all sole accounts, my wife thinks I'm bonkers, but hopefully will come around...). I put it all in a spreadsheet, along with the actions that I need to take on a regular basis.

But in very basic terms, this is the order I did things in (I've tailored the commentary below based on what you are saying about wanting to stick to TSB and Nationwide:

1) Open 2xTesco Current and 2xTesco savings accounts. The current accounts are useful for being able to move money out of Tesco (as well as providing a useful home for any additional cash at 3%), but it's the savings accounts you really need because they generate the direct debits you'll need for the TSB/NW account incentives.

2) Open the TSB and NW Flex direct accounts. I'm pretty sure I got an instant decision on both of them. IMPORTANT POINT ABOUT NATIONWIDE... there is a 'refer a friend' scheme where if you get a referral, you and the referrer also get £100 bonus for opening the account. I'm obviously more than happy to refer you if you wanted to PM me, although to be fair, you will probably get a better deal scouring the referrals board, because there is a whole market in people offering you a percentage of their own bonus money. Personally I find that all a bit grubby (and I say that as a banker...) so it's not a game I'd play!

3) If you don't already have suitable 'donor' accounts that you are prepared to switch to TSB and Nationwide, open them. My own view is that if you have a longstanding relationship with Natwest (as I do) then I wouldn't switch that specific account - anecdotally, it could look good on your credit file to have a continuous history with one bank. I set up an additional current account online with Natwest in about 5 minutes - they are one of the easiest to do if you already have a relationship with them.

4) Once the 2 donor accounts are open and you have sort code/account details, you can log in to your tesco accounts and set up direct debits (it calls it 'move money in' I believe) to each of the donor accounts. One from each savings account to each donor. Make sure the donor accounts have some nominal funds in them (£20 or so) and don't play silly b*ggers with tiny DD amounts, £5/month seems to be a generally agreed 'good' amount

5) Wait a few days and then check on the donor accounts that the DDs are showing. Hopefully by that point, you'll also have your debit cards through for them. You may also want to wait until the first DD payments have come out of those accounts, although must admit that I've not bothered myself and it's not caused any problems.

6) Once all the above is done, initiate the account switches at NW and TSB. The NW one is done online and is very straightforward, the TSB one I believe you need to ring them. They will want sort code, account number, and also the donor debit card number. Set it for the earliest available date (7 working days ahead).

7) In terms of the regular savers, I know NW won't let you open one until the switch is complete. I think you can do it straightaway with the TSB one. Anyway, monitor and open as and when you can. I think they are both funded from the current accounts as standing orders.

8) In case you haven't already done so, make sure you've got the full £2500 in NW and £2000 in TSB by this point so you're getting the 5% interest.

9) In terms of regular funding mechanics (i.e. £1000 into NW and £500 to TSB) you've got a couple of options. Either you can do it manually one day per month using faster payments online, or you can set up standing orders so that you bounce an equal and opposite amount between the 2 accounts. Both options have pros and cons but I prefer the manual method, because faster payments transactions are pretty instantaneous (at least for these 2 banks), and it will take you all of 5 minutes a month to do. Whereas with an automated standing order, you have to consider things like weekends and public holidays. Personally I don't like my accounts having the wrong amounts in them for any more than a few minutes!

10) And finally... make sure you have a spreadsheet to track it all - the progress of account opening, which donor account will move to which 'real' account, what the details of the linked savers are, details of the tesco DD generating accounts, regular funds movements, incentive payments etc. Without that, I personally would have no chance of making this work!

Hopefully that's covered everything, I'm sure the other regulars will help fill in any gaps. Just one question on choice of TSB over first direct or perhaps Halifax - I assume you're intending to make full use of the 5% contactless spend per month? Otherwise not sure that's the best second option after Nationwide...

Good luck
RC

zolablue25

ratechaser wrote: »

1) Open 2xTesco Current and 2xTesco savings accounts. The current accounts are useful for being able to move money out of Tesco (as well as providing a useful home for any additional cash at 3%), but it's the savings accounts you really need because they generate the direct debits you'll need for the TSB/NW account incentives.


RC

What DD requirements are you referring to with the TSB? We have 2 accounts with them (and a regular savings) and neither of them require DDs for the interest, just £500 a month pumped through.

ratechaser

zolablue25 wrote: »

What DD requirements are you referring to with the TSB? We have 2 accounts with them (and a regular savings) and neither of them require DDs for the interest, just £500 a month pumped through.

Ah.... I WAS going to say that it was a requirement to get the switching bonus, but I've just rechecked, and it looks like that particular offer has expired. So it would appear that the TSB account process is a bit simpler now, if £100 less valuable than when I opened mine!