Will these bank accounts maximise my savings?

akira181

I know there must be a lot of these threads but I've done a lot of reading and I think I've figured out what is best; I want to just check before I start opening multiple bank accounts and risk damaging my credit rating.

I've managed to clear all my debt and I never go into my overdraft now, and I have around 10k sitting in a Bank of Scotland current account that I've had since I was a student 10 years ago, paying next to nothing in interest (I think 0.1%).

I only have 2 direct debits so my bills are not high enough to offset the Santander 123 monthly fee [STRIKE]and if I don't get any overtime at work, I'll miss the minimum monthly payment of £1,500 for Lloyds Club, so that is out as well.[/STRIKE] (learned I can meet the min requirements with some standing orders and DDs but shouldn't get too many accounts with LBG)

This is my thinking, please let me know if I've missed anything.


1) Switch from Bank of Scotland to Halifax Reward to get the £100 switching bonus (need a donor account first to get switching bonus). My 2 DD will come from this account and my wage will go into it, satisfying the requirements.

Set up £1000 standing order to account #2
Transfer remainder to account #4 (minus ~£50 to cover the DDs and to remain in credit for the £5 a month interest)


2) Open a Nationwide FlexDirect account. No DD requirements and transfer from account #1 satisfies min pay in. Keep £2.5k here to maximise the 5% interest for 12 months.

Set up £500 standing order to each account in #3


3) Open 2x Tesco accounts [STRIKE]Bank of Scotland Vantage[/STRIKE](avoiding too many LBG accounts). No DD requirements and no min pay in (transfers in just to keep activity in accounts). Keep £3k here to maximise the 3% interest.

Set up £500 Standing order from each to account #4


4) Open TSB Reward account. No DD requirements and transfer from #1 and #3 satisfies min pay in. Keep £2k+ in here as this will be my daily account. I get the 5% interest on the £2k balance and the cashback on any contactless payments

Set up £200 standing order to account #5


5) Open Santander Help to Buy ISA and transfer in £200 a month


6) Any spare cash leftover from account #5 can be transferred into a Nationwide FlexClusive Regular Saver. Max £500 per month at 5%



I've managed to get my budgeting under control to clear my debt but maximising my savings is still very new to me. So any advice is greatly appreciated!

Thanks in advance!

*updated with advice from below

YorkshireBoy

akira181 wrote: »

1) Switch from Bank of Scotland to Halifax Reward to get the £100 switching bonus.

Suggest you read the Halifax £100 switching offer T&Cs.

Kim_13

You can't get the £100 switching bonus from Halifax with a Bank of Scotland current account.

Having multiple accounts within the LBG group has seemed to trigger closures for some customers, so you might want to look at Tesco instead. You can get 2 x 3% on £3,000 accounts in your own name with no monthly pay in.

If you get the Flex Direct, the Nationwide FlexClusive Regular Saver will take £500 per month at 5%.

YorkshireBoy

akira181 wrote: »

...if I don't get any overtime at work, I'll miss the minimum monthly payment of £1,500 for Lloyds Club, so that is out as well.

You have £10K. How can you not afford to pay in (and immediately pay out again) £1,500? Sometimes you need to think outside the box.

YorkshireBoy

akira181 wrote: »

2) Open a Nationwide Flex Account. No DD requirements and transfer from account #1 satisfies min pay in. Keep £2.5k here to maximise the 5% interest for 12 months.

Assume you mean FlexDirect, as the FlexAccount doesn't pay interest.


Also, by opening, rather switching into, this account, you'd be throwing £100 away as you'd miss out on a potential refer-a-friend bonus. All you need is a donor account and a couple of DDs (which are very easy to come by if you read the forum posts).

akira181

Thanks for the replies! I saw the mistake in my thinking with the Halifax switching error soon as I read your posts :doh:

Kim_13 wrote: »

Having multiple accounts within the LBG group has seemed to trigger closures for some customers, so you might want to look at Tesco instead. You can get 2 x 3% on £3,000 accounts in your own name with no monthly pay in.

If you get the Flex Direct, the Nationwide FlexClusive Regular Saver will take £500 per month at 5%.

Didn't realise banks could close your accounts just cause you smartly take them up on their incentives. I'll swap out BoS Vantage for 2 Tesco accounts in that case. Thanks for the warning! I'm assuming having just a TSB and Halifax account will be okay right?

I'm not sure I'll have £500 spare at the end of every month but I'll definitely consider that saver account.

YorkshireBoy wrote: »

You have £10K. How can you not afford to pay in (and immediately pay out again) £1,500? Sometimes you need to think outside the box.

Assume you mean FlexDirect, as the FlexAccount doesn't pay interest.

Also, by opening, rather switching into, this account, you'd be throwing £100 away as you'd miss out on a potential refer-a-friend bonus. All you need is a donor account and a couple of DDs (which are very easy to come by if you read the forum posts).

You're right, I probably could go for the Lloyds Club with a couple of standing orders. I only have 2 DD so I didn't give it that much thought, but looks like I need to do some more digging on the forums! But either way, after what Kim said, I don't think I should get another account with LBG!

And I do mean FlexDirect, thanks for the catch! Updated the original post with the information provided.

YorkshireBoy

akira181 wrote: »

I don't think I should get another account with LBG!

Up to you, but I have 8 current accounts with them and I'm not concerned!

akira181

Fair enough but since I will open all these in relatively quick succession, I don't think I want to risk it just yet. Once I get a better job and start maxing out these accounts, I'll look into a few more.

One question about the Tesco account, I can open 2 in my own name?

YorkshireBoy

akira181 wrote: »

I'm not sure I'll have £500 spare at the end of every month but I'll definitely consider that saver account.

You were originally planning on keeping £5K at 3% AER (with BoS Vantage). Transferring this over the year to the 5% AER Flexclusive regular saver will see you net an aggregate 4%...just the same as you'd get at Lloyds, but with no DDs required.


Like I said, think outside the box.

Kim_13

Yes, 2 Tesco accounts in your sole name are permitted.

Any bank can close your account with 60 days notice, without giving a specific reason. LBG closures are far more common than others it seems (you'll be able to find old threads on here.)

Since Tesco doesn't have a pay in requirement, it seems better to go for them than BOS (their interest is tiered so you could well be getting less than 3% if you need access to some of the money.) Tesco accounts also offer clubcard points on spending (though few) but better than nothing if you don't have any other way of obtaining cashback on purchases (TSB is contactless cashback only and limited to £100 of purchases per month.)

There have been theories that the 3x BOS accounts have been the trigger in the closures. If you were using the Halifax Reward as a main account then it may be less likely to happen to you, especially with only one BOS, but no one can guarantee and I would personally go for one account (and Regular Savers) with each group before doubling up.

TSB and Halifax are now separate, but some posters prefer to ensure that they don't make a payment directly from one to the other.

With the Nationwide Saver, multiple deposits are allowed per month so you could max it out by seeing what you can save each month and drip feeding up to the maximum from a 3% account.

akira181

YorkshireBoy wrote: »

You were originally planning on keeping £5K at 3% AER (with BoS Vantage). Transferring this over the year to the 5% AER Flexclusive regular saver will see you net an aggregate 4%...just the same as you'd get at Lloyds, but with no DDs required.

Like I said, think outside the box.

Good point, definitely got more reading to do to try and get my head around all this. Would I be right in saying I should put the max possible into a 5% regular saver at the expense of not maxing out a 3% account?

Kim_13 wrote: »

Since Tesco doesn't have a pay in requirement, it seems better to go for them than BOS (their interest is tiered so you could well be getting less than 3% if you need access to some of the money.) Tesco accounts also offer clubcard points on spending (though few) but better than nothing if you don't have any other way of obtaining cashback on purchases (TSB is contactless cashback only and limited to £100 of purchases per month.)

I assume I should still set up some SOs for the Tesco accounts and not just put £3k in and forget about it?

I would reach the £100 limit on TSB easily every month. Not overly fussed about Tesco points since I use my girlfriends clubcard whenever I go.

I was considering looking into a credit card with some sort of reward scheme that I'd pay off every month but haven't gotten that far yet. Open to suggestions as to what's best here if you have any


I've updated the OP again. Is what I've got there a good start or are there further tweaks I should look into?