Santander 123 rate to be cut to 1.5%

bigadaj

Snakey wrote: »

Assuming you're getting most or all of it tax-free, you're coming out above inflation on most of these interest-paying current accounts. CPI is 0.6% and even RPI is below 2%.

Sure, keep an eye on things in case the position changes significantly, but the market could be volatile over the next couple of years and I wouldn't go chasing higher returns if it doesn't suit your investment timescale or risk profile. If that risk doesn't pay off and you lose capital you'll be crying into your beer wishing you'd stuck with even Santander's proposed 1.5%.

(Not aimed at you but I'm quite surprised, actually, by the number of apparently sensible people who are proposing to do things like this for no other reason than to teach the banks a lesson. Excuse me while I wipe away the tears of mirth. Yes they'll surely be kicking themselves for having lost the opportunity to pay you 5% interest while watching you cycle the minimum payment in and out on the same day once a month and never use the account or the bank for anything that might actually make them some money.)

Agree with the general sentiment though the inflation point is a bit disingenuous.

Not only is the calculation widely questioned and the ons is changing it, but inflation projections are showing sharp increases, the devaluation of the pound makes that certain pretty much in the short to medium term.

Mannanan

With regard to Santander 123, instead of closing, I bucked the trend by opening a second sole account. Yes, the system allowed me to do it online, despite saying only one account allowed. With a little help from a well known supermarket, I easily set up the two DD' required. So that's another £20,000 getting 3% until November. Watch and wait is I guess the mantra for now but I still think 1.5% may not seem too bad in 3 months time.

Speculator

The system does allow you to open a second. I opened my 2nd 123 a/c in April and was paid the correct interest every month until I closed it last week.

uk1

Speculator wrote: »

The system does allow you to open a second. I opened my 2nd 123 a/c in April and was paid the correct interest every month until I closed it last week.

I opened two in my name, but when opening a second in the wife's name, they telephoned her and apologised and said she could only have the one but gave her a cash service recovery credit to say sorry.

It seems that it is a bit of a lottery and they clearly don't get grumpy when people try.

Jeff

Mannanan

Although it has dropped from 5% down to 3%, I was tempted to try and open a second Santander Regular E-Saver. Problem is you can't actually apply online for an E-Saver which seems very odd to me. I didn't want to phone them in case they twigged they had given me two 123 accounts so I shall let that one go.

Snakey

bigadaj wrote: »

Agree with the general sentiment though the inflation point is a bit disingenuous.

Not only is the calculation widely questioned and the ons is changing it, but inflation projections are showing sharp increases, the devaluation of the pound makes that certain pretty much in the short to medium term.

Disingenuous means "lacking in frankness, candour or sincerity" according to the internet, with synonyms including "underhand" and "deceitful". Charming!

I included the figure for RPI as well as CPI precisely because I know that the CPI is often not considered a true measure of inflation even though it's the one that the ONS uses.

It is possible to calculate one's personal level of inflation, if you want total accuracy, but I didn't think that was what the person I was replying to was talking about and in any case it would no more predict the future than any other measure.

My first paragraph is in the present tense, since I was replying to somebody who's talking about moving money by the end of September, and my second one goes on to say "keep an eye on things in case the position changes".

Choppy waters ahead all around when it comes to currency movements. What if Trump gets in, what if Le Pen gets in and there's a Frexit, and China's always been dodgy. All you can do is watch the skies.

bigadaj

Snakey wrote: »

Disingenuous means "lacking in frankness, candour or sincerity" according to the internet, with synonyms including "underhand" and "deceitful". Charming!

I included the figure for RPI as well as CPI precisely because I know that the CPI is often not considered a true measure of inflation even though it's the one that the ONS uses.

It is possible to calculate one's personal level of inflation, if you want total accuracy, but I didn't think that was what the person I was replying to was talking about and in any case it would no more predict the future than any other measure.

My first paragraph is in the present tense, since I was replying to somebody who's talking about moving money by the end of September, and my second one goes on to say "keep an eye on things in case the position changes".

Choppy waters ahead all around when it comes to currency movements. What if Trump gets in, what if Le Pen gets in and there's a Frexit, and China's always been dodgy. All you can do is watch the skies.

Yes, disingenuous is a milder version of your similes which is why I used it.

I thought your overall assessment was fine but the inflation statistics were potentially not helpful in the overall context of interest rates and return.

You are right in that things do and will change, much talk of us interest rate increases currently which would logically lead to a stronger dollar and likely higher uk inflation given that many commodities are priced in dollars, particularly oil but also foodstuffs, metals etc etc

ScoobyZ

When they reduce you rates you need to leave!

Switch to some of the other accounts pay 3-5% and when they cut rates leave them too.

Get one of the £150 switching bonus accounts.

It's the only way they will learn.

YorkshireBoy

ScoobyZ wrote: »

When they reduce you rates you need to leave!

Where to?

Switch to some of the other accounts pay 3-5%

Already have them.

and when they cut rates leave them too.

Again, where to?

Get one of the £150 switching bonus accounts.

Already bagged them all.

It's the only way they will learn.

How else can I teach them?

ScoobyZ

YorkshireBoy wrote: »

Where to?

Regular Savers. 2% to 6%
Fixed Rate ISA;s 1.7% especially if you have cash available in other accounts.
Peer to Peer Lending.
Pay off mortgage if Rate is above 1.5%.
S&S ISA's.
SIPP if you are near 55 and want some tax back.


Maybe a little of all the above!

Already have them.

Not everybody does. Plus you can put in a lower interest account. Lots at just over 1% with no fees.

Again, where to?

As above.

Already bagged them all.

Again not everybody has.

How else can I teach them?

You can't the only way is to leave them. It might seem like cutting your nose off to spike your face, but if everybody did it they would need to rethink.

Or just stick with them and go "oh well they have increased the monthly fee and halved the rate but it's still OK as it's 1.5%"