Managed Cash Deposits,,,what are they?

Kayserrant

I have heard today of something called managed cash deposits. Its where if you have money say from the sale of a house, and dont want to spread it around in 75k fscs units, someone does this for you, at better rates than you can get on the high street, and they themselves get money from the bank for placing it there.

I have never heard of such a thing.....can anyone help shed some light/knowledge please?

tacpot12

Never buy anything you don't understand. Put your money where it is safe. National Savings and Investments is an option. Spreading your money around multiple banks is another.

Kayserrant

Thanks. I have never heard of this. They put it in ‘normal’ deposits etc, but do it for you apparently. It seemed like a good idea (came from a chartered ifa) but totally new to me

LHW99

I'd check that IFA actually is a registered IFA - and then not use them!

firestone

not sure you will get a better rate as you mention but guess the product you mean could be the likes of Octopus Cash which have an adviser & retail section and spread your money across 8 banks such as Metro and Teachers BS up to £510,000 protected in multiple accounts but in One place (could be other companies as sure somebody else was doing it a couple of years back)
But only the adviser can confirm their claims on FSCS limits and you would need to check if you already have funds with the partner banks i guess
If it is kosher i would still be careful in how much you put through at a time as i would guess it would be in the umbrella account before being invested with the partner banks

Kayserrant

Yes, they are defintely chartered ifa’s!
Thanks firestone for the info... i will look up now
Kinda feels risky some how now!

short_butt_sweet

it's not quite the same thing, but this is in some ways similar to HL's active savings service. in this case, you yourself decide how to split your cash among different deposit takers; one way to do it is in chunks just under the FSCS limit.

however, currently active savings only has an instant-access product from one deposit taker (coventry BS). the other products are all fixed-term products (with various terms). so it's not useful if you want all your cash on instant access.

Kayserrant

short_butt_sweet wrote: »

it's not quite the same thing, but this is in some ways similar to HL's active savings service. in this case, you yourself decide how to split your cash among different deposit takers; one way to do it is in chunks just under the FSCS limit.

however, currently active savings only has an instant-access product from one deposit taker (coventry BS). the other products are all fixed-term products (with various terms). so it's not useful if you want all your cash on instant access.

Hey this is all great info, thanks short butt sweet . Much appreciated

firestone

short_butt_sweet wrote: »

it's not quite the same thing, but this is in some ways similar to HL's active savings service. in this case, you yourself decide how to split your cash among different deposit takers; one way to do it is in chunks just under the FSCS limit.

however, currently active savings only has an instant-access product from one deposit taker (coventry BS). the other products are all fixed-term products (with various terms). so it's not useful if you want all your cash on instant access.

Looks very similar to Octopus Cash even many of the same partner banks so guess its very much like fund supermarkets (think Raisin was the other One i was thinking of) But would always check the terms regarding the FSCS limit and what they claim

Kayserrant

Thanks firestone. I like the point you made about watching the initial amount you put in so its not over the fscs amount before its distributed.

londoninvestor

Kayserrant wrote: »

at better rates than you can get on the high street, and they themselves get money from the bank for placing it there.

This would make me very cautious. So they claim that the bank not only pays you a better rate than if you went direct, but also has money left over to pay a commission to the advisor? That doesn't seem like business the bank would be rushing into...

The Octopus product mentioned is a legitimate one, but it gives you rates that are pretty comparable to what you'd get going direct (e.g. 1.9% for 1 year, 2.15% for 2 years). I'm not saying the convenience isn't of value, of course.