Reg. Savers 5%

badger09

AndyPK wrote: »

So basically what you are saying is that I need to open 2
current accounts and then switch them to hsbc and m&s and maybe first direct. To get switching bonus. I can then get their regular saver for a year.

the bonus + reg saver is worth doing. I just wished their current accounts earned some interest!

Which you can renew every year. At least, you can at the moment, of course no guarantee that will continue:cool:

YorkshireBoy

AndyPK wrote: »

So basically what you are saying is that I need to open 2
current accounts and then switch them to hsbc and m&s and maybe first direct. To get switching bonus. I can then get their regular saver for a year.

the bonus + reg saver is worth doing. I just wished their current accounts earned some interest!

All 3 of those have differing hoops to jump through. Be sure you know which has which before jumping in.

Katiehound

AndyPK wrote: »

So basically what you are saying is that I need to open 2
current accounts and then switch them to hsbc and m&s and maybe first direct. To get switching bonus. I can then get their regular saver for a year.

the bonus + reg saver is worth doing. I just wished their current accounts earned some interest!

What do you want jam on it??

Hopefully you are going to get a welcome financial handshake and access to a decent rate RS (M&S is their giftcard not cash- but still useful)
You could also open some current a/cs which pay interest such as Tesco & BoS but you will need DDs going out. Yes, I know 2% isn't amazing, but it could be worse- zero, zilch, nada!!

Snowflake

Please can someone explain how 5%interest is worked out on for example the £300 per month that you can save with first direct reg saver, which amounts to £3600 over a year. In idiot proof numerical jargon would be great..I know how much interest you get cos I did it last year but how it's worked out is a mystery and I do not get it t all. Thank you

AndyPK

Yes. Would be useful to park some money !

Santander TSB, Clydesdale used to have good current accounts and savers.

I have BOS and Tesco already thank you

AndyPK

Compound interest. Get yourself an excel spreadsheet.

At the end of the first month you have £300
So 300 divided by 100 times 5 interest percent divided by 12 months will be the interest after first month.

Then the second month is 300 + interest + 300 and work out the interest is on that total and so on

YorkshireBoy

Snowflake wrote: »

Please can someone explain how 5%interest is worked out on for example the £300 per month that you can save with first direct reg saver, which amounts to £3600 over a year. In idiot proof numerical jargon would be great..I know how much interest you get cos I did it last year but how it's worked out is a mystery and I do not get it t all. Thank you

1st payment in for 12 months, second for 11 months, 3rd for 10 months, etc.

So you have:

12/12ths + 11/12ths + 10/12ths + ....

12/12 + 11/12 + 10/12.........+ 3/12 + 2/12 + 1/12 = 78/12 = 6.5

So you've the equivalent of the whole £3K being in for only 6.5 months, generating interest of:

£3,000 x 5% / 12 x 6.5 = £81.25

Of course if you're drip feeding the £3K from an account making 1.5% then you'll also earn interest on the £3K for the other 5.5 months, so:

£3,000 x 1.5% / 12 x 5.5 = £20.63

Total interest of £101.88

And £101.88 / £3,000 x 100% = 3.396%

Much better than 1.5%.

YorkshireBoy

AndyPK wrote: »

Compound interested. Get yourself an excel spreadsheet.

At the end of the first month you have £300
So 300 divided by 100 times 5 interest percent divided by 12 months will be the interest after first month.

Then the second month is 300 + interest + 300 and work out the interest is on that total and so on

There's no monthly compounding on these regular savers.

jimjames

polymaff wrote: »

The trick is to fund regular savers from regular income. Then you really do receive the full rate.

You receive the full rate however you fund the account

ValiantSon

Eco_Miser wrote: »

You think 1.4% is better than 2.xx%?

It depends what the .xx% is, but if it is 2.25% (as the OP indicates) then yes, 1.4% in an easy access savings account would be better on the total sum than the regular saver would be, e.g. £250 p/m at 2.25% = £36.44, whereas £3000 at 1.4% over 12 months = £42.