Regular Savers - open new after 12 months?

WineDarkSea

Thanks for the info, I did mean £300 for the FD but I'd just opened the NW one which is £500 so head full of numbers. I'll look again at the FD switch offer, I read something about paying in £1k a month to avoid the £10 charge.

I suspect I will be told that it is definitely best to open as many accounts as possible as soon as possible. I was considering staggering them as having a sudden £18,000 plus interest released all at once may be tricky to relocate (HSBC, NW, Santander, M&S and FD), that's in addition to £7,200 in FlexDirect accounts.

I do want to spend some money on home improvements this year £6k perhaps. This will leave us with just over £40k by the end of the year and I'm really struggling to juggle it all, most has to be in my name as a non tax payer/basic rate if I get a job as planned later this year, my DH pays 40% and we've used up the £500 PSA already (yes it isn't the worst problem to have). I need to get my head around it all and figure out which accounts we can have lying dormant without being charged etc. I'm really tempted to quit my 123 account as it will be the best to feed the reg savers but we lose out with the £5 charge - the Natwest account would be better for the cashback - £5.64 per month instead of £4.46. It's a lot of juggling and searching T&Cs.

badger09

WineDarkSea wrote: »

I'll look again at the FD switch offer, I read something about paying in £1k a month to avoid the £10 charge.

Read post 7 again;)

WineDarkSea wrote: »

I suspect I will be told that it is definitely best to open as many accounts as possible as soon as possible.

Only in the sense that nobody knows how long these high interest current accounts will be around. Regular savers have been around for years, but again, there is no guarantee that the current interest rates will be maintained, indeed TSB as very recently reduced its monthly savings rate from 5% to 2%.

WineDarkSea wrote: »

I do want to spend some money on home improvements this year £6k perhaps. This will leave us with just over £40k by the end of the year and I'm really struggling to juggle it all, most has to be in my name as a non tax payer/basic rate if I get a job as planned later this year, my DH pays 40% and we've used up the £500 PSA already (yes it isn't the worst problem to have). I need to get my head around it all and figure out which accounts we can have lying dormant without being charged etc. I'm really tempted to quit my 123 account as it will be the best to feed the reg savers but we lose out with the £5 charge - the Natwest account would be better for the cashback - £5.64 per month instead of £4.46. It's a lot of juggling and searching T&Cs.

You don't say how much you have in the Santander account, but if you're 'really struggling to juggle it all' then I wouldn't be in any hurry to ditch it. The gain on the cashback is tiny, the Natwest account pays no interest, and you'd have to find a home for the £20k (?) currently in Santander:cool:.


Finding a home for £40k at reasonable rates really isn't hard, but does involve some juggling:p

Its not clear from your posts how much you need a home for right now. If you want to provide a bit more detail, we'll try to help

WineDarkSea

This is the detail in the FD switch offer - This account has a £10 monthly fee, but this is waived each month you either pay in £1,000, have an average monthly balance of £1,000 or hold selected other accounts with First Direct.

It's no big deal to transfer in and out with the other monthly transfers.

I current have £12k in Santander but this will be reduced by £500 going into the NW saver each month. Everything else is in other accounts - 2x TSB, 2xLloyds, 2xBoS, 3xNW - all full except 1 BoS has £3k and 1 NW £2.2k to go under the £500 PSA. We save about £700 per month and by April will have the £7.2k from NW and £3k reg saver. So that's approx £16.5k in April. Once the NW FlexDirects accounts end I will open a lloyds under my husband's name and a joint TSB, taking care of £7k. That will leave around £17k in Santander, although if we spend £6k it will be £11k left until the NW reg saver matures with £6k in June - we should have £18k in Santander by then. I have opened a Tesco acc for the DD creation for BoS, and I could try again to open a second and third BoS plus a second Tesco - that would take £16k and I'd always be down on that if paying into regular savers. The catch is needing at least £3k in each BoS to earn interest which may be tricky if I use them to fund reg savers. It looks like I'm best sticking with Santander and paying that £5 for the flexibility of up to £20k In one place, especially if we carry on saving at this rate. No chance of buying a bigger house so we'll just keep saving.

badger09

WineDarkSea wrote: »

This is the detail in the FD switch offer - This account has a £10 monthly fee, but this is waived each month you either pay in £1,000, have an average monthly balance of £1,000 or hold selected other accounts with First Direct.

It's no big deal to transfer in and out with the other monthly transfers.

The bit in bold is what you're overlooking. Hint: the Regular Saver isn't one of the 'other selected accounts' but they do have other savings accounts which require a very small minimum balance;)

WineDarkSea wrote: »

I current have £12k in Santander but this will be reduced by £500 going into the NW saver each month. Everything else is in other accounts - 2x TSB, 2xLloyds, 2xBoS, 3xNW - all full except 1 BoS has £3k and 1 NW £2.2k to go under the £500 PSA. We save about £700 per month and by April will have the £7.2k from NW and £3k reg saver. So that's approx £16.5k in April. Once the NW FlexDirects accounts end I will open a lloyds under my husband's name and a joint TSB, taking care of £7k. That will leave around £17k in Santander, although if we spend £6k it will be £11k left until the NW reg saver matures with £6k in June - we should have £18k in Santander by then. I have opened a Tesco acc for the DD creation for BoS, and I could try again to open a second and third BoS plus a second Tesco - that would take £16k and I'd always be down on that if paying into regular savers. The catch is needing at least £3k in each BoS to earn interest which may be tricky if I use them to fund reg savers. It looks like I'm best sticking with Santander and paying that £5 for the flexibility of up to £20k In one place, especially if we carry on saving at this rate. No chance of buying a bigger house so we'll just keep saving.

I see you're avoiding, as far as possible, putting any savings in accounts in your husband's name because of his tax position. I would suggest you think about this. Regular savers in his name paying 6% and 5% would yield 3.6% and 3% net - not to be sneezed at. Similarly, joint 5% accounts, where only half the interest would be taxed @ 40% might be worth considering. In short, don't let the tax position blinker you, as many people do with cash ISAs.

You haven't mentioned M&S or HSBC which also have regular savers @ 6%, though obviously they would entail more juggling:o

Finally, I'm sure someone else will ask, so... are you sure you need to save so much in cash? Have you got pensions sorted? S&S ISAs?

WineDarkSea

Thank you for the advice, it's a good point about opening accounts even if taxed at 40%. I planned to open a joint TSB but its just a pain trying to get to a branch with us both there. The only account he doesn't hold is a Lloyds Club for the 4%. It is worth looking at regular savers for him too, that's even more juggling and £36k total to lock in and then rehome after the 12 months, but I've seen the speculation on interest rates dropping so the sooner the better.

I have HSBC and Nationwide now, can open Santander now (via phone) and do the switching to FD now. I'd need to set up a donor account for the M&S switch - with two DDs. I still need to set up the DDs for the Bos accounts and sort the Tesco account for those DDs.

badger09

Sounds like you've still got a couple of hours work to do (apart from branch visit) to get everything up and running.

Might I suggest a simple spreadsheet so you can keep track of minimum funding requirements, what is going where & when, maturity dates etc. The last thing you need is to end up in unauthorised overdraft because £300 has gone out before it came in:eek:

If you don't like spreadsheets, pencil & paper will do just as well.