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Martin Lewis says Santander 123 is now a dead duck current account as it cuts interest and cashback

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  • zealo
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    I don't really benefit from the cashback but I like having a fairly large buffer of funds available in my current account (currently maintain £20k in the 123 Santander). I'm not interested in any active maintenance hassle (e.g. cycling money through various accounts). After the rate drops to 1% on the Santander account, I figure it would be better to transfer £10k to a Club Lloyds account, and the rest to a Marcus savings account.




    So


    20000*(1%) - 5*12 = £140 before


    1% * 4000 + 2% * 1000 + 1.35% * 10000 = £195 after


    Is this rational?
  • colsten
    colsten Posts: 17,597 Forumite
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    Club Lloyds doesn't pay interest above £5k, and you must regularly cycle £1,500 through the account to avoid monthly fees. Your calculations look ok but there's £5K missing

    Why not put the lot into Marcus?
  • schiff
    schiff Posts: 20,109 Forumite
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    SnowTiger wrote: »
    Midland Bank TV advert from 1984, advertising 'free banking' as a new thing.

    I think that's quite instructive. It isn't everywhere that you can get a extremely efficient service for free and be paid something for what you leave in the account, whether it be at 0.1% or at 1.5%. You could channel 50 SO's and 50 DD's per month through one account for nothing, other than depositing funds in time to meet those requirements.

    I think we tend to overlook that in our drive for the best rates and our disappointment when they are cut.
  • EarthBoy
    EarthBoy Posts: 3,051 Forumite
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    Eco_Miser wrote: »
    Yes I remember the 2d stamp duty on cheques, prepaid when a chequebook was issued. That was the only transaction charge I ever paid a bank, since my first account in 1968. Bank charges may have been common then, but they weren't universal.

    No, they weren't. People like to quote Midland Bank as being the first bank to offer free banking, from the mid-80s, but it was available before then if you shopped around.

    I opened my first current account, with TSB, in 1978 and there were no bank charges. I moved to Williams and Glyn's around 1980/81 and they didn't have any bank charges either. I wouldn't have joined them if they had. When more banks started to offer free banking, they usually imposed a condition that you had to keep a minimum credit balance of £50 in your account at all times to avoid the charges. This condition was eventually dropped, until all banks provided free banking as long as you didn't go overdrawn.
  • robatwork
    robatwork Posts: 7,132 Forumite
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    molerat wrote: »
    Log into your account, on right hand side click upgrade current account, select 123 lite, click upgrade, fill in form.

    Useful info that a Santander secure message failed to procure...ta
  • robatwork
    robatwork Posts: 7,132 Forumite
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    robatwork wrote: »
    Useful info that a Santander secure message failed to procure...ta

    However for a joint account you both need to visit a branch.
  • Stuart_W
    Stuart_W Posts: 1,748 Forumite
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    EarthBoy wrote: »
    No, they weren't. People like to quote Midland Bank as being the first bank to offer free banking, from the mid-80s, but it was available before then if you shopped around.

    I opened my first current account, with TSB, in 1978 and there were no bank charges. I moved to Williams and Glyn's around 1980/81 and they didn't have any bank charges either.

    You're right. Lots of options prior to Midland Bank were available to bank for free. I have a feeling that free banking was actually first offered by Co-op Bank in the early 70's with TSB and Girobank being other free options soon afterwards.
  • Bionic_woman_2
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    Delighted to be able to ditch Santander at last, only stayed for the interest. Absolutely awful customer service and contempt for customers.
  • colsten
    colsten Posts: 17,597 Forumite
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    Delighted to be able to ditch Santander at last, only stayed for the interest. Absolutely awful customer service and contempt for customers.
    Do you reckon they'll be deeply distraught to see the back of you?
  • harz99
    harz99 Posts: 3,653 Forumite
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    colsten wrote: »
    He is not giving advice, and no, he is not qualified to give financial advice as he doesn't have the required accreditation. I don't believe any of the MSE staff has it, either. For this reason, just about all of the pages on the main site state "This info does not constitute financial advice"

    This does, however, not stop people from blindly following what he writes, ignoring that every page also says "...always do your own research on top to ensure it's right for your specific circumstances and remember we focus on rates not service" and "We're a journalistic website and aim to provide the best MoneySaving guides, tips, tools and techniques, but can't guarantee to be perfect, so do note you use the information at your own risk and we can't accept liability if things go wrong"

    Most of the warning only appeared after the Crown Currency Exchange debacle...
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