Piggy banking

Bookowl

Hi,
Ive recently stared budgeting. I came across the piggy banking idea on the website. I am currently with nationwide and like the idea of the piggy banking option. If I keep my income in my nationwide account and set up another bank account for bills / savings, will this affect my credit rating in future years (looking to buy a house in 4-7 years)? And which accounts are the best on the market at the moment for piggy banking ?
Thanks

Kim_13

You'll need to pass a credit check to get the best accounts, but a credit search is only visible on your credit file for a year (with the Experian and Equifax agencies) or two years (with Call Credit.) So the search will be long gone if you are buying in 4-7 years.

This article runs through the best accounts available: https://www.moneysavingexpert.com/banking/compare-best-bank-accounts?_ga=2.139319923.1798824297.1513112874-1010848097.1513112873

What's best depends on whether you're looking for cashback on your bills or interest on the sum in the account. There's no harm in opening two more accounts if you want both.

In this day and age it's advisable to hold more than one bank account, in case one is suddenly frozen or has an IT failure etc.

datlex

In my opinion. For piggy banking, you will find that the interest rate isn't hugely important. You will build up funds just by being more organised with your finances. Piggy banking is about giving your money a job. And yes it may earn interest whilst doing that job. However, interest rates are low. Even 5% that you can get on some accounts is for a very small balance. Now that's not to say that the interest/ rewards earned aren't useful. (I certainly have made use of them) However, the monetary gain from piggy banking is greater than that from interest.

Sarastro

I would say the positive effect on your credit score from having better money management would outweigh any reduction caused by opening another account, particularly as it's unlikely to be that detrimental if it's with the same bank. Credit Scores aren't everything.