Natwest Savings Builder

shazkhan111

Hi,

Can anyone tell me what are the flaws and pitfalls of this account?

https://personal.natwest.com/personal/savings/savings-builder.html?View=int&intcam=N_PC_HPTO_0_Sav_SavGen_hSavB_Link_a1

Thanks

surreysaver

It has to have at least £100 more in it at the end of the current month than it did at the end of the previous month to earn the full amount of interest

Grumpyoldmoo

As of April '18 you can put a minimum of £50 per month in the account to earn the full amount of interest

EachPenny

surreysaver wrote: »

It has to have at least £100 more in it at the end of the current month than it did at the end of the previous month to earn the full amount of interest

One of the pitfalls is the balance check is done on the "second-last working day" of the month - which in some months can be well before the actual end of the month.

The plus sides include:-
*Instant access, you can put in as much as you want and take as much out, all that matters is the balance on that second-last working day.

*Transfers in and out by FP

*1.5% interest on £5000, easy access.

In the past people have managed the account by opening it, adding £5000 immediately, then topping it up by £100 per month. The additional £100 amounts only earn 1% interest. At some point they then withdraw everything and wait a month before starting again. This is the approach I adopted to begin with.

However, it appears an equally valid strategy is to pay £5000 in to start with, then withdraw £4900 the day before the second-last working day. Thus your first balance will be £100. The day after the second-last working day you pay £4900 back in and resume earning 1.5% on £5000.

Then just before the second-last working day of the second month you withdraw £4800 leaving a balance of £200. Which is £100 more than for month one so you qualify for the bonus interest rate.

Then repeat each month decreasing the amount withdrawn and paid back in by £100 each time. That should give about four years of earning 1.5% interest on £5000, with the only loss of interest being on the money withdrawn for a couple of days at the end of each month. If it actually moves to another interest bearing account then the losses are minimal.

Doing it that way round avoids having a steadily increasing balance above £5000 which is only earning 1%.

Edit: and of course from April it only needs to be £50, meaning 8 years of not exceeding the £5000. Hopefully by then interest rates will have returned to a more reasonable level.

ValiantSon

For me the biggest drawback is that you only get 1.5% on balances up to £5,000. It is just a personal view, but I don't consider the difference in rate between this and a normal easy access account to be worth the effort of the messing around.

Alexland

An obvious pitfall is that it's with Natwest. We just moved a couple of current accounts to get the £125 bonus and are less than impressed with the Natwest service and systems. Not a bank I would want to stay with. I don't mind clunky old systems such as Halifax Share Dealing if there is a genuine cost advantage to me from their under-investment.

Natwest products are average, they need to try harder.

shazkhan111

@EachPenny - very useful - super post!!

RG2015

Alexland wrote: »

An obvious pitfall is that it's with Natwest. We just moved a couple of current accounts to get the £125 bonus and are less than impressed with the Natwest service and systems. Not a bank I would want to stay with. I don't mind clunky old systems such as Halifax Share Dealing if there is a genuine cost advantage to me from their under-investment.

Natwest products are average, they need to try harder.

I have banked with NatWest for 43 years and never had any problems. Their current account banking services are second to none. What products do you think are average?

If by products you mean savings accounts, insurance and packaged accounts I agree with you 100%. I have had all of these and they were very poor so I switched these services but kept the basic banking with them. It's what they do well and now they now also have an excellent mobile banking app as well.

I have current accounts with First Direct, Nationwide, Santander and Tesco for their savings rates and regular savers but I would not want them for my main account.

Oh and yes, I have the NatWest Savings Builder because there is no other instant access savings account giving 1.5% on up to £5,000.

ValiantSon

RG2015 wrote: »

I have banked with NatWest for 43 years and never had any problems. Their current account banking services are second to none....

...I have current accounts with First Direct, Nationwide, Santander and Tesco for their savings rates and regular savers but I would not want them for my main account.

I'm intrigued as to why you consider NatWest to be second to none and why you wouldn't want to use any of those other banks for your day to day banking. My experience of NatWest so far is of a disorganised company who haven't got a clue. This is compared to all of the banks you list (and others) who are much more on the ball and, in my experience, deliver good customer service.

I'm with Alex; I'll take my £125 and then look for somewhere else to pay me to switch.

RG2015

ValiantSon wrote: »

I'm intrigued as to why you consider NatWest to be second to none and why you wouldn't want to use any of those other banks for your day to day banking. My experience of NatWest so far is of a disorganised company who haven't got a clue. This is compared to all of the banks you list (and others) who are much more on the ball and, in my experience, deliver good customer service.

I'm with Alex; I'll take my £125 and then look for somewhere else to pay me to switch.

Each to their own. I have 43 years experience and you have a week or two. Enjoy your £125.

Alexland

Several weeks after the switch they are chasing me almost every day by email and text message for proof of identity. I have uploaded high quality scans of my passport and both sides of my driving license, they have taken copies of both at branch and even provided me with branch certified copies which I have also scanned and uploaded. NatWest don't seem to be able to explain why their systems are still hounding me and constantly reject my documents.

Santander 123 Gold account is still, despite the rate drops, a more compelling offer than Natwest. Whenever I phone the Select number the service is exceptional.

Alex