Reg. Savers 5%

ValiantSon

planteria wrote: »

i currently have £1k/m going into HSBC/M&S/Nationwide.. but when the latter matures i'll only be able to stash £750/m at 5%. and that's if things don't deteriorate further. below 5% i won't bother.. i had an FD current account way back, and since then they haven't allowed me to open another account with them.

If you open a Santander 123 or 123 Lite you'll have access to £200 p/m at 5%.

planteria

good one VS, thank you.

BarGin

Where is the 1.4% account that has been frequently referred to in this thread please?

YorkshireBoy

BarGin wrote: »

Where is the 1.4% account that has been frequently referred to in this thread please?

It's one of 3 examples used for illustration purposes, the others being 1.5% and 1.41%.

AndyPK

BarGin wrote: »

Where is the 1.4% account that has been frequently referred to in this thread please?

Sorry, its not available to open now. Was opened years ago and its rate increased a tad recently.

redux

ValiantSon wrote: »

What?

I never said that you did have the full £3000 in the regular saver! In fact, I quite clearly said that you would be putting £250 in each month, but having the full £3000 in a savings account at 1.4% would yield a higher return.



Again, I never said that they wouldn't. I was simply responding to an erroneous comment that the regular saver at 2.xx% was better than a savings account at 1.4%. The exact arrangements of how you move the money around changes the return, but the bold statement is false.



And once again, I wasn't talking about that either. I did make a second post, commenting on the possibility of someone paying in to a regular saver out of monthly income, but that was an entirely separate point. If you conflate two different and separate comments I make on differing scenarios, then you will misunderstand what I was saying.

You weren't comparing like with like.

You said the interest in £3000 for a whole year in the lower interest account is more than the interest on the regular savings account.

People could easily be funding it from monthly income, and even if they weren't 1.4% on the lump sum is still more than 2.25% on the regular deposit.

It's true in itself, but the reason for the difference is you are talking about 2 people with different availablity of money.

Someone who has monthly income gradually increasing their savings should go for the regular savings account, because some of these have the higher interest

With account availability as they are, someone who has a lump sum already would be best off with decent interest on the lump sum, gradually transferring to higher interest.

Your remark that the interest is more on 1.4% ordinary than 2.25% regular savings sounded like you were negating that, even if you didn't mean to.

I don't know why these two numbers are floating around anyway. Higher rates than that are available.

I don't think anyone mentioned yet that some regular savings accounts have actually increased rates. Bank of Scotland Halifax and Lloyds are all 2.5% for new accounts now (dont know when this started) and the Club Lloyds is 3%, so anyone at Lloyd's could have 2% on the current account and up to £650 a month added at average 2.8%.

adindas

ValiantSon wrote: »

Why would you presume that? People could easily be funding it from monthly income, and even if they weren't 1.4% on the lump sum is still more than 2.25% on the regular deposit.

Indeed 2.25% pa interest on RSA is equivalent to (6.5/12)*2.25% =1.22%. So effective inetrest of 2.25% RSA is just 1.22% which is smaller than 1.4% pa.

But is it the way people managing their account ???
If you have a regular income of £500 (say) you will put it in higher interest current account first (not in a saving account) earning interest of at least 2% , or even 5% if you still have a space for this.

Only if you have maxed out your current AC earning 2%+ interest you start recycliung it by drip feeding it to RSA earning higher than the interest in the current account. If not there is no point to dripfeed it to RSA.

AndyPK

yes I was just looking at the lloyds website

2.5% £250 a month
3% £400 a month (club lloyds customers)

Could someone tell me what they would earn in a year please, maxed out.

£75 ish ? for the 3%
£35 ish ? for 2%

AndyPK

using the formula on previous page I get

£78
£40.62


But these seam too high

YorkshireBoy

AndyPK wrote: »

yes I was just looking at the lloyds website

2.5% £250 a month
3% £400 a month (club lloyds customers)

Could someone tell me what they would earn in a year please, maxed out.

£75 ish ? for the 3%
£35 ish ? for 2%

I provided a formula in post #18. Use it? EDIT: I see you have now.