TSB Classic Plus Interest dropping?

Diefer

Had a survey come through from TSB today asking for opinions on the bank and the Classic Plus account, and part of this included opinions on what I would think if they reduced the in-credit interest to 4% on £1000, instead of the current 5% on £2000. The survey said they are considering this change due to the drop in the Bank of England base rate. They said other benefits would stay the same. One question also asked if I would prefer 3.5% on £1250, 3% on £1500, or 2% on £2000 (obviously I answered 3% on £1500!).

It seems inevitable that the interest on the TSB account will be dropping fairly soon.

YorkshireBoy

Diefer wrote: »

One question also asked if I would prefer 3.5% on £1250, 3% on £1500, or 2% on £2000 (obviously I answered 3% on £1500!).

Why is it obvious? Interested in your reasoning because I'd have gone for 3.5% on £1250.

xylophone

3.5% x £1250 = £43.75

3% x £1500 = £45

2% x £2000 = £40.

Speculator

YorkshireBoy wrote: »

Why is it obvious? Interested in your reasoning because I'd have gone for 3.5% on £1250.

Me too. You're only getting £1.25 extra interest compared to £1250 @ 3.5%.

£1250 @ 3.5% = £43.75
£1500 @ 3.0% = £45.00

YorkshireBoy

xylophone wrote: »

3.5% x £1250 = £43.75

3% x £1500 = £45

2% x £2000 = £40.

I was OK with the maths thanks.

Just didn't want to come clean on my reasoning until the OP had answered, but what's the other £250 going to make elsewhere? I'd only need >0.5% AER and I'm in profit. And there are lots of options for that!

GTR_King

so they are dropping the interest rates to 4% is this true??

xylophone

so they are dropping the interest rates to 4% is this true??

No announcement yet...will it be the account with more minusness?:eek:

djpailo

I reckon it'll be 2% on £2000. They might then give 2% cashback and make it the 222 account.

dreaming

I also had this survey and also one from Tesco - although that one didn't mention interest rates. I spent a bit of time yesterday plugging different rates into my spreadsheet to see how interest will change per rate and also adjusting my budget as have car insurance renewal, then Christmas to plan for. I tend to use the monthly interest for a bit of extra spending money (monthly pension is just below tax threshold) but will adapt quite easily I am sure. It could be a lot worse.

Stuart788

I'd spent last year perfecting my and my partner's saving so that we came out with £5000 a year in interest and now it's all been blown to hell.

Kim_13

So much for changes to 2nd accounts only.