Santander to Lloyds?

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I am trying to figure out whether it is worth switching from Santander 123 to Lloyds Club. I use to have a balance of about £15,000 so Santander 123 was the clear winner according to this article: http://blog.moneysavingexpert.com/2015/09/21/should-i-ditch-santander-123-due-to-the-fee-increase/

However, I recently spent £12,000 on a car etc. Therefore I have a balance of just under £3000. I also have £2,000 in a TSB account earning 5% interest (balances up to £2K) and £1,000 in a HSBC account earning 5% (on balances up to 1K). I cannot open a Nationwide FlexFirect account until November next year (the 5% interest expired in November this year so I closed the account).

My calculation is as follows:

(2/100)*2000=20 (2% on balances from £2,000 to £3,000)
(1/100)*1000=10 (1% on balances from £1,000 to £2,000)
One years 123 cashback (approximately): 55.56
Cost: 60

Based on this calculation, the return would be just: £25.56

Therefore I am planning to switch to Club Lloyds initially and then switch back to Santander when my balance hits: £8,550 (I am saving £1000 per month), so I suspect this will be around May/June next year. Seems a lot of hassle i.e. switch away, then switch back. What are your thoughts?
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  • Futuristic
    Futuristic Posts: 1,138 Forumite
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    edited 10 December 2015 at 8:50PM
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    If you switch to Lloyds you should keep that account and continue to use it daily. Club lloyds also offer a saver account £400/mo @ 4%

    You can then open say a TSB/Nationwide 5% (£2000/2500) if you want to maximise interest once you're over the £5k limit or open a BOS account for 3% on £5k and feed any excess over the Lloyds £5k to these account(s).

    123 is not really worth it unless you've exceeded Nationwide/TSB/Lloyds/BOS/Tesco bank or you want to put £10-20k in one place (then again BOS would take 3x £5k in a sole account under your name).
  • colsten
    colsten Posts: 17,597 Forumite
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    w00519772 wrote: »
    I also have..... £1,000 in a HSBC account earning 5% (on balances up to 1K).
    What account is that please?
  • colsten
    colsten Posts: 17,597 Forumite
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    w00519772 wrote: »

    Therefore I am planning to switch to Club Lloyds initially and then switch back to Santander when my balance hits: £8,550 (I am saving £1000 per month), so I suspect this will be around May/June next year. Seems a lot of hassle i.e. switch away, then switch back. What are your thoughts?
    I wouldn't use a 123 account until I had exhausted all the accounts that have absolutely no charge, and pay from 3% AER upwards. I would also exploit Regular Savings accounts that pay at least 5%. All of them easily beat the 123 if your total savings are below £10K - £20K, regardless of what it says in the MSE article.
  • w00519772
    w00519772 Posts: 1,297 Forumite
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    colsten wrote: »
    What account is that please?

    This was a special offer at a specific time. I had to meet a load of requirements. HSBC never offered it again.
  • w00519772
    w00519772 Posts: 1,297 Forumite
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    Futuristic wrote: »
    If you switch to Lloyds you should keep that account and continue to use it daily. Club lloyds also over a saver account to save £400/mo @ 4%

    You can then open say a TSB/Nationwide 5% (£2000/2500) if you want to maximise interest once you're over the £5k limit or open a BOS account for 3% on £5k and feed any excess over the Lloyds £5k to these account(s).

    123 is not really worth it unless you've exceeded Nationwide/TSB/Lloyds/BOS/Tesco bank or you want to put £10-20k in one place (then again BOS would take 3x £5k in a sole account under your name).

    I have the following:

    HSBC: £1000 earning 5%
    TSB: £2,000 earning 5%
    Santander: £3,000 earning 1%-2%

    I also had a Nationwide account with 5% interest. However, the 12 months expired in November. Therefore I opened a Yorkshire Bank account to switch the Nationwide account to (Yorkshire Bank had a £150 cashback offer at the time). I have to keep the Yorkshire Bank account open for three months after the switch to get the $150 cashback.

    What would you do with the £3,000 in the Santander account. Yorkshire Bank offer 2% interest. Therefore I am thinking about transferring everything to Yorkshire Bank. What would you do?
  • colsten
    colsten Posts: 17,597 Forumite
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    w00519772 wrote: »
    This was a special offer at a specific time. I had to meet a load of requirements. HSBC never offered it again.


    Sounds a bit like the Halifax free fiver a month (HSBC £50 a year vs Halifax £60), except it ties up £1,000 that could earn interest at up to 6% AER elsewhere. Small amounts in this case, but it's the essential principle of keeping/using your money for best return.
  • colsten
    colsten Posts: 17,597 Forumite
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    w00519772 wrote: »

    What would you do with the £3,000 in the Santander account. Yorkshire Bank offer 2% interest. Therefore I am thinking about transferring everything to Yorkshire Bank. What would you do?

    Just one much better idea: Move it to a 3% Tesco current. Drip-feed a 5% Nationwide FlexClusive Regular Saver. Repeat when the 12 months on the FlexClusive RS are up.

    Also get yourself a Halifax Reward. You should be able to get the £100 switch bonus without killing any current accounts you need, and if you meet the (easily meet-able) T&Cs, it pays you £5 a month / £60 a year.

    All a huge lot better than the 2% in YB.
  • w00519772
    w00519772 Posts: 1,297 Forumite
    edited 10 December 2015 at 9:10PM
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    colsten wrote: »
    Just one much better idea: Move it to a 3% Tesco current. Drip-feed a 5% Nationwide FlexClusive Regular Saver. Repeat when the 12 months on the FlexClusive RS are up.

    Also get yourself a Halifax Reward. You should be able to get the £100 switch bonus without killing any current accounts you need, and if you meet the (easily meet-able) T&Cs, it pays you £5 a month / £60 a year.

    All a huge lot better than the 2% in YB.

    1) Do you get 3% on balances from 0-3000 with Tesco bank? I think you are suggesting opening this account from scratch (rather than switching)?
    2) Can I open this FlexClusive account after I have switched to Yorkshire Bank?
    3) I recently transferred a Halifax Stocks and Shares ISA, which I switched to Charles Stanley. I had a Halifax current account about two years ago, which I closed. I can still log in to Halifax even though I have no accounts with them. Can I still open a Halifax Reward?
    4) I think you are suggesting that I switch the Santander account to the Halifax reward?

    I also have a santander credit with a balance of £1,300. What should I do with this? I shop at Tesco so I wander if a tesco bank credit card would be a good opportunity.
  • colsten
    colsten Posts: 17,597 Forumite
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    w00519772 wrote: »
    1) Do you get 3% on balances from 0-3000 with Tesco bank?
    yes, see T&Cs. When I last checked, T&Cs also said you can have 2 accounts with them. £6K therefore :cool:

    w00519772 wrote: »
    I think you are suggesting opening this account from scratch (rather than switching)?
    there's no switch offer am aware of, so yes
    w00519772 wrote: »
    2) Can I open this FlexClusive account after I have switched to Yorkshire Bank?
    FlexClusive has pre-reqs that are relatively easy to meet (see their website). If last three years are anything to go by, it is worth to maintain eligibility as there have been many good deals.
    w00519772 wrote: »
    3) I recently transferred a Halifax Stocks and Shares ISA, which I switched to Charles Stanley. I had a Halifax current account about two years ago, which I closed. I can still log in to Halifax even though I have no accounts with them. Can I still open a Halifax Reward?
    would have thought so
    w00519772 wrote: »
    4) I think you are suggesting that I switch the Santander account to the Halifax reward?
    switch ANY suitable account to Halifax to get the switch bonus. If necessary, open a donor account.
    w00519772 wrote: »
    I also have a santander credit with a balance of £1,300. What should I do with this? I shop at Tesco so I wander if a tesco bank credit card would be a good opportunity.
    if it's a 123 credit card, it will cost you £3 a month soon, instead of £2. It may or may not be worth keeping it....May be check the credit card forum for best deals on credit cards.
  • Eco_Miser
    Eco_Miser Posts: 4,708 Forumite
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    colsten wrote: »
    Sounds a bit like the Halifax free fiver a month (HSBC £50 a year vs Halifax £60), except it ties up £1,000 that could earn interest at up to 6% AER elsewhere. Small amounts in this case, but it's the essential principle of keeping/using your money for best return.
    You're suggesting dumping an unrepeatable 5% account, to put into 6% Regular Savers - when the OP is already saving £1000 a month, and you are suggesting 3% accounts in other posts. ???
    Eco Miser
    Saving money for well over half a century
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