Recycling money through current accounts

enthusiasticsaver

I am switching out one of my Santander 123 accounts which involves finding a home for £20k in other high interest current accounts. I have opened a First Direct and applied to switch the Santander 123 account to it for the £150 switching bonus and the access to the 6% regular saver. I have also opened a Club Lloyds and BOS Vantage tonight as well. I still have to open a 2nd Tesco current account (already have 1 with £500 in it) and one more BOS Vantage account.


Can anyone spot a flaw in my bank monthly transfer plan below?


Cycle 1 (already in action)

Santander 123, Nationwide and TSB already full
At the moment I do a £1k transfer from our joint Santander 123 (still keeping that) to Nationwide Flex Direct. From there £500 goes to the Flexclusive regular saver and £500 to TSB Classic Plus Account.
£250 goes from the TSB Classic Plus account to the regular saver and £250 back to Santander 123 joint
All go through on the same day each month by standing order


To be set up after Club Lloyds and BOS Vantage 1 filled from the Santander 123 which is to be closed (£5k each)

Cycle 2
Transfer £1500 from hub account (joint Santander 123 account) to Club Lloyds to fulfil income criteria.
Transfer £1500 (less the 2 monthly direct debits to come out of Club Lloyds) to Bank of Scotland Vantage 1 then back to Santander 123 joint account.
Again all to be done on the same day each month by standing order


To be set up after 2nd BOS Vantage account opened and FD regular saver opened via FD current account


Cycle 3


Transfer £1300 from hub account (Santander 123 joint) to FD current account and £300 to go across to regular saver
Transfer £1000 from FD current account to BOS Vantage 2 account and then back to Santander 123


I think this fulfils the income criteria of all of them and the only ones I need to set up direct debits on are the Club Lloyds. This also means I will not have to pay any fee on the FD account or the Club Lloyds. I will move all cashback earning direct debits back to our main Santander 123 account meaning the £5 fee will be covered in full. Any remaining balance in the Santander 123 sole account will go into my Tesco account and the new Tesco account.


Any feedback or simpler way round this?

Eco_Miser

You don't mention how you handle the interest arising in all these accounts. Apart from that, it appears to work.

However:
The FD doesn't need funding to avoid the fee, there is an easier way.

The two BOS accounts could cross fund each other.

You could move Santander £1500 -> Lloyds,
Lloyds £400 -> Lloyds Saver, £1100ish -> Nationwide
Nationwide £500 -> Saver, rest -> TSB
TSB £250 -> Saver, rest -> FD
FD £300 -> Saver, Excess back to Santander.

This cycle of reducing amounts fulfills all the conditions and moves rather less money through Santander.

Kernel_Sanders

Aren't you having a Club Lloyds reg saver (£400pm @ 4%APR?)

Just seen that Eco Miser also mentions it.

I'm surprised BoS allows transfers between its Vantage accounts to count as income; I thought the reason no banks insist on 'genuine' income is that they can't ascertain this if funds come from a different bank.

enthusiasticsaver

Eco_Miser wrote: »

You don't mention how you handle the interest arising in all these accounts. Apart from that, it appears to work.

However:
The FD doesn't need funding to avoid the fee, there is an easier way.


Do you mean by opening a second FD account (not a regular saver)? What other way is there to avoid it other than leaving £1000 in there earning no interest?

The two BOS accounts could cross fund each other.


Are you allowed to do that? I thought it had to be new money. I will explore that option.

You could move Santander £1500 -> Lloyds,
Lloyds £400 -> Lloyds Saver, £1100ish -> Nationwide
Nationwide £500 -> Saver, rest -> TSB
TSB £250 -> Saver, rest -> FD
FD £300 -> Saver, Excess back to Santander.

This cycle of reducing amounts fulfills all the conditions and moves rather less money through Santander.

That is useful thanks providing BOS will accept cross funding.