Nationwide Flexdirect interest query

peterstrutt

Nationwide Flexdirect offer 5% interest up to £2500 on condition that £1000 per month is paid in. I'm wondering if you keep £2500 in the account and set up a standing order whereby £1000 is transfered out to another account every month and then transfered back in the day after, would you qualify for the 5% interest?

ColdIron

I have two opposing standing orders for £1,000 on the same (mid month) day. Works just fine

bowlhead99

Yes, as with most accounts, they don't tell you how you can use your own money that you are storing in their current account. If you would like to spend it on something or move it to another amount, you're welcome to do that.

It's a current account - they are not expecting you to put £1000 in every month and never remove anything so it builds up to £12000 after a year.

The most extreme solution would be to literally move the money in and out the same day. But you might prefer to have a chain of standing orders processing on different days - with the result that at some point, you temporarily don't have the maximum amount overnight (which means you are earning the goods rate on less than the maximum amount they are willing to pay you interest on)... or at some point you temporarily have more than the maximum amount overnight (in which case there's some money you're not earning interest on because they cap it at £2500).

lettucekl

So how much do you actually make on the £2500 at the end of the year if you transfer a £1000 in and then the next day transfer it out again, so basically at the end of the years there still £2500 in the account, surely its only about £130 you'd be making from interest?, seems a lot of effort for such a small return?

eskbanker

lettucekl wrote: »

So how much do you actually make on the £2500 at the end of the year if you transfer a £1000 in and then the next day transfer it out again, so basically at the end of the years there still £2500 in the account, surely its only about £130 you'd be making from interest?, seems a lot of effort for such a small return?

£122.25.

Obviously up to you if you don't feel it's worth the 'effort' of setting up a couple of zero-maintenance standing orders, but many on here do, unsurprisingly for a money saving site!

peterstrutt

It seems to me that there's very little effort to this. All you have to do is open the account, put £2500 in and set up a standing order to put £1000 in each month and another standing order to transer £1000 back out on the same day. Once that's done you do nothing.

YorkshireBoy

peterstrutt wrote: »

It seems to me that there's very little effort to this. All you have to do is open the account, put £2500 in and set up a standing order to put £1000 in each month and another standing order to transer £1000 back out on the same day. Once that's done you do nothing.

Why wouldn't you want to extract the interest too? Make the outbound SO £1,010 or thereabouts.

peterstrutt

YorkshireBoy wrote: »

Why wouldn't you want to extract the interest too? Make the outbound SO £1,010 or thereabouts.

Yeah, good idea.

Doubleshotdamo

I pay in 1k per month on DD, and out again the same day. Just remember, once this matures, you will no longer be able to open another one at 5%, unless it's joint (if yours is in a single name now).

eskbanker

Doubleshotdamo wrote: »

I pay in 1k per month on DD

It's not possible to fund this account by direct debit from another of your accounts, you presumably mean standing order....

surreysaver

lettucekl wrote: »

So how much do you actually make on the £2500 at the end of the year if you transfer a £1000 in and then the next day transfer it out again, so basically at the end of the years there still £2500 in the account, surely its only about £130 you'd be making from interest?, seems a lot of effort for such a small return?

Its far less effort than it is to post on here asking if its worth the effort