Would it be better to put my savings into a current account instead?

pauljoecoe

It's complicated and takes some careful setting up but certainly better to keep money in current accounts than savings, including ISA's now there is no tax on interest (well up to £1000 worth of interest anyway)

I have:

6 X TSB @ 5% (£12,000)
2 X Tesco @ 3% (£6000)
2 X Lloyds @ 4% (£10,000)
Santander @ 3% (£10,000)
Regular savers with Nationwide, First Direct, M & S at around 4-5%
Halifax reward (£5 per month for paying in £750 - and then out again!)
Nat west for Cashback on Bills

Some of these need a monthly deposits in but standing orders in and out each month deal with all this.

Nationwide Flex Direct do 5% for up to £2500 but only for 1 year.

ah23

HappyMJ wrote: »

TSB pays 5% interest on balances up to £2,000.

edit: oops...brain not working today.... it is TSB not Lloyds.

Aretnap wrote: »

You're probably thinking of TSB there. A Club Lloyds account will pay 4% interest on balances between £4000 and £5000, with lower rates applicable if the balance goes below £4K.

To answer the main question though, yes the OP would be better off with a high interest current account (or a couple of current accounts) than a bog standard savings account. Remember that you can have more than one current account if you like, and that the minimum monthly pay in doesn't have to be your salary - you can meet it by transferring money from one account to the other and back again, which is very easy to set up with a couple of standing orders.

Hi both, correct me if I'm wrong, but is this 5% interest paid monthly? I ask because my Santander 123 Postgrad account pays 3% interest on anything up to £2k - in other words, I get interest of £30 per month provided I have 2k in my account the entire month.

Is this the same for TSB? I get 5% interest every month on balance up to £2k?

ah23

pauljoecoe wrote: »

It's complicated and takes some careful setting up but certainly better to keep money in current accounts than savings, including ISA's now there is no tax on interest (well up to £1000 worth of interest anyway)

I have:

6 X TSB @ 5% (£12,000)
2 X Tesco @ 3% (£6000)
2 X Lloyds @ 4% (£10,000)
Santander @ 3% (£10,000)
Regular savers with Nationwide, First Direct, M & S at around 4-5%
Halifax reward (£5 per month for paying in £750 - and then out again!)
Nat west for Cashback on Bills

Some of these need a monthly deposits in but standing orders in and out each month deal with all this.

Nationwide Flex Direct do 5% for up to £2500 but only for 1 year.

Thanks for your help. Is the interest paid monthly on all of your accounts, particularly the TSB account?

mollycat

ah23 wrote: »

Hi both, correct me if I'm wrong, but is this 5% interest paid monthly? I ask because my Santander 123 Postgrad account pays 3% interest on anything up to £2k - in other words, I get interest of £30 per month provided I have 2k in my account the entire month.

You sure about that??

jimjames

ah23 wrote: »

Thanks for your help. Is the interest paid monthly on all of your accounts, particularly the TSB account?

My TSB account pays interest monthly. You can monitor when by looking for the threads on here asking why it's not been paid on the 1st of the month

YorkshireBoy

pauljoecoe wrote: »

Santander @ 3% (£10,000)

Since you're using Natwest for cashback on bills, putting that £10K in a pair, or even 3, BoS Vantage accounts would save/make you another £60 a year!

Regular savers with Nationwide, First Direct, M & S at around 4-5%

Mine pay 5-6%.

ah23

mollycat wrote: »

You sure about that??

That's what the personal banker told me before signing up...

Edit: I got my maths wrong on the percentages, oops!

YorkshireBoy

ah23 wrote: »

That's what the personal banker told me before signing up...

Edit: I got my maths wrong on the percentages, oops!

No they didn't. They said it was 3% AER, paid monthly. The 'A' in AER stands for annual.

But surely you realised that a £720 annual return on a £2K deposit represented a return of 36%? ie totally unrealistic!


* EDIT: You've edited your post a second time. In your first edit you were expecting £60 a month, hence my £720 figure above.

ah23

YorkshireBoy wrote: »

No they didn't. They said it was 3% AER, paid monthly. The 'A' in AER stands for annual.

But surely you realised that a £720 annual return on a £2K deposit represented a return of 36%? ie totally unrealistic!


* EDIT: You've edited your post a second time. In your first edit you were expecting £60 a month, hence my £720 figure above.

Ah yes, of course. Thanks for clarifying!

pauljoecoe

YorkshireBoy wrote: »

Since you're using Natwest for cashback on bills, putting that £10K in a pair, or even 3, BoS Vantage accounts would save/make you another £60 a year!Mine pay 5-6%.

Yeah, 6 % on the FD I believe...couldn't be bothered to find out the rates to be honest.

Re BoS. I do use the Santander for cash back on some bills. My head started aching when trying to work out the best options when Santander put their fees up. Not seen the BoS Vantage before...will look into that.