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Keep emergency fund separate?

13

Comments

  • Humdinger1
    Humdinger1 Posts: 2,429 Forumite
    Eighth Anniversary 1,000 Posts Name Dropper
    Zero sum,

    Thanks for chipping in. Yes, you're right re the cashback, but you have to pay 5 monthly for the full 123 account to get the 1.5% interest. On the full 20k, if you have the lite bank account, you're losing 25, unless something has changed?

    Humdinger
  • Zero_Sum
    Zero_Sum Posts: 1,567 Forumite
    Humdinger1 wrote: »
    Zero sum,

    Thanks for chipping in. Yes, you're right re the cashback, but you have to pay 5 monthly for the full 123 account to get the 1.5% interest. On the full 20k, if you have the lite bank account, you're losing 25, unless something has changed?

    Humdinger

    You dont keep savings in the 123 account. You keep it in Marcus as it works out better. The 1.5% advertised rate is the gross amount. If you dont have much in, you're actually getting a negative return. Full £20k you're only getting 1.2%
    You're losing nearly £50 a year by having the full 123 account.
  • Marcus hasn’t been 1.5% for new accounts for months. It’s down to 1.35% now.
  • Zero_Sum
    Zero_Sum Posts: 1,567 Forumite
    edited 19 December 2019 at 9:11AM
    MaxZorin wrote: »
    Marcus hasn’t been 1.5% for new accounts for months. It’s down to 1.35% now.

    I know, but its still better than full fat 123

    Actually due to the OP's inability to use £ signs, I misread the OP thinking they were only getting 25p in interest. Still £30 a year better off keeping cash in Marcus at 1.35% than 123 at 1.5% less additional £48 fee.
  • Humdinger1
    Humdinger1 Posts: 2,429 Forumite
    Eighth Anniversary 1,000 Posts Name Dropper
    Just checking I can post while on the naughty step re pound signs...yep, seems to be working. Sorry for any confusion, the symbols don't always work. As mentioned above, I do get the monthly fee more than covered by cashback on dds and retail offers; if that weren't the case, I'd deffo go to the 123 lite account.

    Looking at all the replies, there's a lot of different ways of tackling this. Thanks again everyone. Humdinger
  • talexuser
    talexuser Posts: 3,543 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Humdinger1 wrote: »
    I do get the monthly fee more than covered by cashback on dds and retail offers; if that weren't the case, I'd deffo go to the 123 lite account.

    You still get the cashback on 123 lite for £12 a year fee. Any excess of monthly spend gets more interest elsewhere.
  • Zero_Sum
    Zero_Sum Posts: 1,567 Forumite
    Humdinger1 wrote: »
    Just checking I can post while on the naughty step re pound signs...yep, seems to be working. Sorry for any confusion, the symbols don't always work. As mentioned above, I do get the monthly fee more than covered by cashback on dds and retail offers; if that weren't the case, I'd deffo go to the 123 lite account.

    Looking at all the replies, there's a lot of different ways of tackling this. Thanks again everyone. Humdinger

    You're still not getting it. The 123 lite pays EXACTLY the same cashback but costs £48 a year less. The extra £48 does NOT cover the interest that can be earned elsewhere.
  • Humdinger1
    Humdinger1 Posts: 2,429 Forumite
    Eighth Anniversary 1,000 Posts Name Dropper
    Zero

    Thanks for all the trouble you're taking. I think we might be at cross purposes though. I do understand that the cash back is the same with both versions. I do get three hundred pounds a year in interest from having 20k in there, with 1.5% interest. I do also have 2 savings accounts (1 Santander) currently paying 3%, and am paying the max into both. The five pounds per month I have to pay to make the 300 quid annually on this account is covered by cashback. The interest paid by other current accts is so marginal, it hardly seems worth setting them up.

    Anyway, thanks again for your time. My original question re keeping emergency funds separate comes down to temperament, it seems. If you can see a balance without wanting to spend it, it can work to keep it together. As I've not felt the least urge to blow the 20k in all the months it's been sitting there, I've learned my lesson at a deep level I think.

    Humdinger
  • Zero_Sum
    Zero_Sum Posts: 1,567 Forumite
    In reality you're getting £252 in interest & not £300. Ie 1.2% net of fees


    You mention opening up the esaver at 0.45% & you dont have the urge to spend, then why not open the marcus account instead of the e saver & just chuck everything in there.
  • Humdinger1
    Humdinger1 Posts: 2,429 Forumite
    Eighth Anniversary 1,000 Posts Name Dropper
    Zero

    Will look at it. I think someone up thread mentioned that Marcus pays 1.35% on new accounts. The appallingly low interest rates are probably the subject for another thread, but I doubt it's going to change any time soon.

    Happy Christmas to you and everyone else commenting/reading.

    Humdinger
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