How many Regular Savings Accounts do you have?

ColdIron

DennisTenus wrote: »

Is the online one usually better rate?

No, to date they have been the same - hence the wetting of gussets and other anticipation around these parts

Paul_DNAP

I've got a Santander and three Virgins (lucky me) was half considering another Virgin but bumped up my pension AVCs to boost the non-cash retirement planning a bit also, but might get in there with an 3% if they do the online version.

gingercordial

AndyPK wrote: »

So what sort of interest are people getting.


I didn't think there were many at 5% ?


But do tell me more.....

My weighted average* interest rate for my set of 17 currently-running regular savers is 3.36%. It is slightly dragged down as one of them is at 1.5% as it pulls by direct debit so is in place for that more than the savings rate itself.

All fully funded each month.

* For those not familiar with the term: if the maximum amount you can put into one account is higher it counts more in the calculation of average interest rate.

JohnRo

gingercordial wrote: »

My weighted average* interest rate for my set of 17 currently-running regular savers is 3.36%. It is slightly dragged down as one of them is at 1.5% as it pulls by direct debit so is in place for that more than the savings rate itself.

All fully funded each month.

* For those not familiar with the term: if the maximum amount you can put into one account is higher it counts more in the calculation of average interest rate.

Weighted or not, the problem with regular savers is that the headline percentage rate doesn't reflect the return because of the throttle on contributions.

I don't bother with anything 'regular saver' that's less than a 3% headline rate.

EachPenny

JohnRo wrote: »

Weighted or not, the problem with regular savers is that the headline percentage rate doesn't reflect the return because of the throttle on contributions.

I don't bother with anything 'regular saver' that's less than a 3% headline rate.

How does that work then?

Cornucopia

JohnRo wrote: »

Weighted or not, the problem with regular savers is that the headline percentage rate doesn't reflect the return because of the throttle on contributions.

When you have one or two, no it doesn't. The more you have, and the more staggered they are, the better the true rate becomes... I think. It also depends on the rate you are receiving on your feeder account(s).

JohnRo

Well done,

The issue is that an annual rate grabs the headline when in fact the contributions are throttled by a monthly cap such that a tiny fraction of the sum contributed annually returns the headline rate.

Within any one year a 5% regular saver returns about half that amount on the sum contributed.

I have no problems with the numbers it's the marketing I object to, it's disingenuous.

Wheres_My_Cashback

JohnRo wrote: »

Well done,

The issue is that an annual rate grabs the headline when in fact the contributions are throttled by a monthly cap such that a tiny fraction of the sum contributed annually returns the headline rate.

Within any one year a 5% regular saver returns about half that amount on the sum contributed.

Does it ? Are you sure? I believe it does what it says in the advertising and gives you a full 5% on every single penny for each day it's saved

soulsaver

Wheres_My_Cashback wrote: »

Does it ? Are you sure? I believe it does what it says in the advertising and gives you a full 5% on every single penny for each day it's saved

No, but it does .. give you a full 5% per annum on every single penny for each day it's saved..

EachPenny

JohnRo wrote: »

The issue is that an annual rate grabs the headline when in fact the contributions are throttled by a monthly cap such that a tiny fraction of the sum contributed annually returns the headline rate.

Within any one year a 5% regular saver returns about half that amount on the sum contributed.

I have no problems with the numbers it's the marketing I object to, it's disingenuous.

The whole of the sum contributed earns the headline rate for the length of time it is deposited in the account.

The error is with people thinking they should be paid interest on money they have not yet deposited.

Which leads us to to the advantage of having multiple RS accounts - even if you cannot fully fund them all - because it means more of your deposits are earning 'headline' rates for more of the time.

For example, by ignoring Virgin's accounts paying 2.5% (because they are %) where are you earning >2.5% on the money which will later be funding the RS accounts that you do have?