I forgot about Drip Feeding !

Mimi_Arc_en_ciel

I'm full of questions today!


Ok so I've opened a few accounts recently. Balances etc below:


TSB 1 (Currently 5%) £2500
TSB2 (Currently 5%) £1750
TSB regular Saver (Currently 5%) £1700.00


First Direct - I'm swapping to this account from Halifax - £1400 (This needs moving when swapped so I don't lose it in bill money)


First Direct Reg saver - £300 (only just started this)


I've also got:


x2 Halifax (Currently £5 pm) - I've swapped my main account to First Direct and will keep one of the Halifax accounts open to get the £3pm running money through it


Co-op £4pm


Barclay Blue £7pm (minus £3 "fee" so really its £4pm)


My plan is this:


Move £2500 from TSB to The nationwide so the account is full, I'll then open a regular savers and drip feed


(What happens when the "saving" account is empty though?!)


I will then have (after the rates drop)


TSB2 (3%) £1750
TSB regular Saver (2%) £1700.00


First Direct will be my main account linked with a 5% paying in £300 (From my wages)


What should I do with the money that's in TSB though?!


I need to use the TSB money to "hit" the targets on the other accounts (Halifax, Co-Op, Barclay Blue)


Thanks!

Eco_Miser

TSB Regular Saver isn't going to drop until you've had it a full year, at which point you start recycling it to other RSs (and the new 2% TSB you'll take out at that point).

You've got too much in TSB1 at the moment, and space in TSB2.

How about a Tesco current account or two? 3% on 2x£3000.

Westie983

Mimi_Arc_en_ciel wrote: »

TSB 1 (Currently 5%) £2500
TSB2 (Currently 5%) £1750
TSB regular Saver (Currently 5%) £1700.00

You have too much in TSB1, as 5% is only paid on balance of £2000, so move £250 to TSB2 so it also has £2000, then the other £250 can either wait till you pay it into the regular saver or move it elsewhere where it will make interest if you regular saver payment is not due in a couple of days or next month.

Westie983

Mimi_Arc_en_ciel

Thanks for the replies.


I've moved some money so both are at their limit now


I've had TSB regular saver for 7 months (paying in £250) so I will leave this for another 5 months.


Am I right in leaving x1 of the TSB's at its capacity whilst the RS is valid? Then move it all into another "high" interest account and drip over to a RS?


I actually have a tesco account that's sitting empty at the moment (I opened it in error when I meant to open a internet savers so I could use the DD!)

Mimi_Arc_en_ciel

So:

First Direct will now be my "main" account which is linked to 5% RS which I will add £300 from my FD account from my wages

Keep x1 TSB account at £1500 (3%) and drip feed over to the RS (which is 5% until March 17)

Put £2500 into Flexdirect and drip feed into linked RS (5%)

put £1650 into Tesco account (3%) and drip feed into............ ?!

I'd need to use the money in Tesco to run through my other accounts to gain interest...

Halifax
Barclays Blue
Co-Op
Nationwide
etc to hit their monthly income targets

Is that right?


What do I do though when the bank account run's "empty" - For example:


Nationwide will have £2500. The regular saver is £500 max per month. The Nationwide Flexdirect account will be Empty within 5 months ..... Do I just move the money from the RS back into the Flexdirect account?!

eskbanker

Mimi_Arc_en_ciel wrote: »

What do I do though when the bank account run's "empty" - For example:


Nationwide will have £2500. The regular saver is £500 max per month. The Nationwide Flexdirect account will be Empty within 5 months ..... Do I just move the money from the RS back into the Flexdirect account?!

No - you need to shuffle your funds around so that you maximise interest earning! So, always make sure you fill any accounts paying 6%, then any that pay 5% and so on - in the specific case of Nationwide in your example, every time you put £500 into the regular saver from the FlexDirect, ensure that you transfer £500 into the FlexDirect to keep it filled at £2500. Do this from the 3% Tesco account - always ensure that if any account runs empty it's the one earning the least interest....

Eco_Miser

eskbanker has already said some of this, but I'm rephrasing it along with some other points.

Mimi_Arc_en_ciel wrote: »

Keep x1 TSB account at £1500 (3%) and drip feed over to the RS (which is 5% until March 17)

Come January, TSB is still going to equal to or beat most current accounts, so keep both accounts until they tell you that they're going to change one of them (you get 60 days notice of that)

Mimi_Arc_en_ciel wrote: »

Put £2500 into Flexdirect and drip feed into linked RS (5%)

put £1650 into Tesco account (3%) and drip feed into............ ?!

FlexDirect - that's earning 5% so keep it at £2500.

Mimi_Arc_en_ciel wrote: »

What do I do though when the bank account run's "empty" - For example:


Nationwide will have £2500. The regular saver is £500 max per month. The Nationwide Flexdirect account will be Empty within 5 months ..... Do I just move the money from the RS back into the Flexdirect account?!

The FlexDirect account should not be empty in 5 months - you should keep it topped up to £2500 until the rate drops. In 5 months time, you will have the contents of your current TSB saver to re-distribute among the 3% and higher accounts.

In general, in addition to making sure that each account receives its required monthly income, you should be moving money from the lowest paying account to any higher paying account that is not 'full'.
When, and only when, all the 3% accounts hold only nominal amounts, you can take money from an account paying 5% to recycle back into it. At this point, you could drop the monthly payment to £25.

Mimi_Arc_en_ciel wrote: »

First Direct will now be my "main" account

Why?
Why keep any money in an account that doesn't pay interest?
Why have a "main" account at all?

Mimi_Arc_en_ciel

Argh I feel like such a dunce 😏

I think I've 'got it'

When I say 'main account' I mean that's the account my wages will go in and bills come out.it runs with very little in

So... .

TSB x2
Tesco x1

Transfer money from nationwide into nationwide RS, transfer money out of Tesco/TSB back into nationwide to keep it topped up.

Use money in tsb/Tesco to hit targets but return back to 3% tsb/Tesco acc?

Eco_Miser

Mimi_Arc_en_ciel wrote: »

Transfer money from nationwide into nationwide RS, transfer money out of Tesco/TSB back into nationwide to keep it topped up.

Use money in tsb/Tesco to hit targets but return back to 3% tsb/Tesco acc?

Yes, in practice you transfer £1000 TSB1->Nationwide,
£500+interest Nationwide->TSB2,
£500 TSB2 ->TSB1
and Tesco ->TSB as required; or something similar to keep all money earning the most it can.

Mimi_Arc_en_ciel

I wrote a long reply yesterday but my tablet crashed

Here's what I've done:

My main account will be First Direct. I have set standing orders to move my "yearly" bills into Tesco (3%) until they are due to be paid.

So I now have:

TSB x1 is full (Savings)
TSB 2 is full (This is "yearly" bills - MOT etc)
Nationwide is full (Savings)

I've set standing orders from both TSB accounts into nationwide for £500 (hitting the £1000 target) and then from nationwide back to TSB. I've set up standing orders to move the interest into Tesco

As mentioned, my "yearly" bills are now going into Tesco - I've set up standing orders to hit the other accounts to get the interest:

Tesco £800 > Halifax > Barclays > Co-Op > Tesco

I also have a TSB regular Saver which comes out on the 1st of each month from TSB1 so I've set a standing order for the same amount from Tesco to go to TSB1 so it stays at £2500 (until the rate drops that is.....)

I've set Direct debits of £2 from Halifax (x2 DD), Barclays (x2 DD) and Co-Op (x4 DD) - the money is sitting in those accounts at the moment so I don't go over drawn

My other regular saver is coming from my First Direct bank account into a first direct regular savers directly from my wages.

The only other thing I need to d is get a nationwide regular savers but when i tried yesterday the bank said I needed to wait 5 working day to get the account up and running properly. When this is done I'll transfer money out of nationwide (5%) into the regular savers and then move the same amount from Tesco (3%) into nationwide

Just 1 question though!

When the standing order goes: Tesco>Halifax>Barclays>Co-Op>Tesco I've set it all to go on the same day. So it will leave tesco on the 1st, hit halifax on the first, leave halifax on the first, hit barclays on the 1st and so on

Will that be ok?!

Thank you so so much for all your help - I really do appreciate it

YorkshireBoy

Mimi_Arc_en_ciel wrote: »

Just 1 question though!

When the standing order goes: Tesco>Halifax>Barclays>Co-Op>Tesco I've set it all to go on the same day. So it will leave tesco on the 1st, hit halifax on the first, leave halifax on the first, hit barclays on the 1st and so on

Will that be ok?!

Tesco are unique in that they despatch SOs on non-working days, so you will lose a few days interest several times a year using this approach.

And automating transfers to/from accounts that don't have sufficient coverage (eg Halifax, Co-op, Barclays if you're suing them purely for rewards) exposes you to overdraft charges should things go wrong, ie if a particular bank has a systems failure.