Santander 123 interest rate going from 3% to 1.5%. Where to put my money now?

traineepensioner

"I'll be keeping our joint account, and downgrading our two individual accounts, leaving only a few hundred pounds in both. The £40k will be split with half going into p2p and the other half going into a balanced portfolio, albeit outside of an ISA because it's been maxed out."
.....Won't you still have to pay the £5 monthly fees on both your individual accounts?

Doh! already aware.....

lonewolf123

I'm going to downgrade my 123 to the lite version and move all my savings elsewhere so I benefit from the DD cashback and get decent interest with no account fee.

Is this what others are going to do?

YorkshireBoy

lonewolf123 wrote: »

I'm going to downgrade my 123 to the lite version and move all my savings elsewhere so I benefit from the DD cashback and get decent interest with no account fee.

Is this what others are going to do?

How have you managed to get them to waive the £1/mth fee?


But to answer your question, I'm sure some will. Those of us with nowhere to go will have to grin and bear it with c1.2% AER.

lonewolf123

YorkshireBoy wrote: »

How have you managed to get them to waive the £1/mth fee?


But to answer your question, I'm sure some will. Those of us with nowhere to go will have to grin and bear it with c1.2% AER.

My bad should have elaborated a bit more.

As in the account I'm intending to move it to won't have a monthly account fee.

I can just about live with the cheeky £1 charge

bigfreddiel

Ballard wrote: »

Your protest is presumably because rather than paying 2.5 over base they'll only be paying 1.25 over base. It's a national disgrace.

Absolutely correct, glad you feel the same way fj

YorkshireBoy

lonewolf123 wrote: »

I can just about live with the cheeky £1 charge

The reason for such a nominal fee is that it's much easier/less painful to increase a fee than to introduce one later. I'd wager many (most?) of their 123 customers (with DDs and small savings, despite this site saying shift if you've less than £9K) stayed earlier this year with the increase to £5/mth. And that's what's prompted them to make such a savage cut to the rate.

How long do we think the 'Lite' fee will remain at £1/mth?...turn of the year?...next summer? If it's still £1/mth by this time next year I'll eat my hat!

My DDs generate around £4.50 a month (a little less in Feb/Mar due to council tax), so if I downgraded to 'Lite' they'd be paying me £3.50 a month (around £40 a year) to pay my bills for me!

lonewolf123

YorkshireBoy wrote: »

The reason for such a nominal fee is that it's much easier/less painful to increase a fee than to introduce one later. I'd wager many (most?) of their 123 customers (with DDs and small savings, despite this site saying shift if you've less than £9K) stayed earlier this year with the increase to £5/mth. And that's what's prompted them to make such a savage cut to the rate.

How long do we think the 'Lite' fee will remain at £1/mth?...turn of the year?...next summer? If it's still £1/mth by this time next year I'll eat my hat!

My DDs generate around £4.50 a month (a little less in Feb/Mar due to council tax), so if I downgraded to 'Lite' they'd be paying me £3.50 a month (around £40 a year) to pay my bills for me!

This is very true.

If the fees were to go up on the lite then it will just be a matter of how much and whether my DD cashback is enough to offset it.

Hopefully competition between banks will remain so cashback on DD's remain. If Santander increases the fee too much then I'll just close my account altogether and move elsewhere where I get cashback on my DD's with a lower fee.

Banks have a lot of power over consumers but I'd say consumers equally have a lot of influence over them so banks try not to make rash movements too quickly.

ColdIron

YorkshireBoy wrote: »

How long do we think the 'Lite' fee will remain at £1/mth?...turn of the year?...next summer? If it's still £1/mth by this time next year I'll eat my hat!

Logged in Google Calendar, it's a Monday BTW

AndyPK

I thought I calculated that as long as you had £4K in there the interest would pay for the £5 fee.

This is without even thinking of cash back

bigfreddiel

AndyPK wrote: »

I thought I calculated that as long as you had £4K in there the interest would pay for the £5 fee.

This is without even thinking of cash back

So if you have less than £4K your on a loser

Fj