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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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  • harz99
    harz99 Posts: 3,655 Forumite
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    robatwork wrote: »
    However for a joint account you both need to visit a branch.

    Last time we downgrade our joint 123 to Lite we did it on the phone...
  • colsten
    colsten Posts: 17,597 Forumite
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    harz99 wrote: »
    Most of the warning only appeared after the Crown Currency Exchange debacle...
    So that's been about a decade now for people, who think financial advice comes for free, to notice. Though I could swear I saw it years before then. Martin Lewis has never pretended to be a Financial Adviser.
  • robbo87
    robbo87 Posts: 42 Forumite
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    The 'official' mse email seemed to think retention was possible. From santander's T&Cs is seems quite dependent on their goodwill.

    eg "Fund the account with a standing order from a Santander current account" So, close current a/c and can't add to esaver?

    eg "If you don’t fund the account from your Santander current account or if you deposit more than £200 in any month, Santander reserve the right to change your account into an Everyday Saver" So, add to eSaver after current a/c closure and it becomes a low int a/c?

    Haven't read the entire thread so Apols if this is repeating an earlier post..


    https://www.santander.co.uk/personal/savings-and-investments/savings/regular-esaver
  • colsten
    colsten Posts: 17,597 Forumite
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    robbo87 wrote: »
    The 'official' mse email seemed to think retention was possible. From santander's T&Cs is seems quite dependent on their goodwill.

    eg "Fund the account with a standing order from a Santander current account" So, close current a/c and can't add to esaver?

    eg "If you don’t fund the account from your Santander current account or if you deposit more than £200 in any month, Santander reserve the right to change your account into an Everyday Saver" So, add to eSaver after current a/c closure and it becomes a low int a/c?

    Haven't read the entire thread so Apols if this is repeating an earlier post..


    https://www.santander.co.uk/personal/savings-and-investments/savings/regular-esaver
    I saw that, too, in the revised MSE write-up. I think it's a very dangerous suggestion and I hope people will think for themselves.
  • flyerperson
    flyerperson Posts: 31 Forumite
    edited 22 January 2020 at 8:03PM
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    I have the 'full fat' 123 'Select' Current Account and wanted to find out not just what I would 'lose' by switching, but also if I downgraded to the 'Lite'.

    ***Since the last interest rate cut I don't use the a/c for 'savings' as such - so the next cut due is not a factor for me, current a/c features are though !

    There are other elements (not mentioned in the MSE article as far as my check could see !) that would be changed/lost that account holders should be aware of to make a balanced decision....

    I haven't gone through this entire thread, so apologies if there's repetition....

    I am still undecided, certainly the only viable option is 'Lite' as I need a current account, not an easy saver option....

    The 'Select' advantages also, weirdly, as far as I could detect are not fully outlined even on Santander's own website !!!

    I phoned Santander and the responder took time to slowly amass the list of differences !!!

    1. Cash withdrawals at some overseas ATMs with 'Select' are free.

    I have used this facility on occasion eg when in Spain/Portugal.

    2. Interest rates on Santander savings accounts often have a 'Select' preferential interest rate.

    I got a 2Yr fixed ISA last year at 1.9%, for non-Select the rate was nearer to the normal offered elsewhere of 1.3%.

    For me a downgrade to 'Lite' would save about £40/year in fees - that could change as my present electricity provider does not qualify for cashback....

    BUT I'd lose the above possible advantages, along with overdraft differences and anything I've still yet to discover.

    I don't think that any switch/downgrade decision is as straightforward as MSE suggests....
  • tallgareth
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    With 1% interest I'll make ~£205/year from my 123 account on a balance of £20k (include cashback from bills and the £5/month fee). I'm interested to know if I can make more than that with a different account or accounts. Can anyone advise?
  • 18cc
    18cc Posts: 2,120 Forumite
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    They should rename it the '3 to 1 account'
  • colsten
    colsten Posts: 17,597 Forumite
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    edited 22 January 2020 at 11:48AM
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    tallgareth wrote: »
    With 1% interest I'll make ~£205/year from my 123 account on a balance of £20k (include cashback from bills and the £5/month fee). I'm interested to know if I can make more than that with a different account or accounts. Can anyone advise?
    Literally anywhere that pays more than 1% AER. You might have to split your £20k if you want to maximise your returns, and leaving some in the 123 Lite could make sense if you get cashback - - [STRIKE] though it sounds as if you get just £5 a year so it seems hardly worth it. [/STRIKE]

    A selection of interest rates is under Banking and Saving
  • eskbanker
    eskbanker Posts: 31,958 Forumite
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    colsten wrote: »
    tallgareth wrote: »
    With 1% interest I'll make ~£205/year from my 123 account on a balance of £20k (include cashback from bills and the £5/month fee). I'm interested to know if I can make more than that with a different account or accounts. Can anyone advise?
    Literally anywhere that pays more than 1% AER. You might have to split your £20k if you want to maximise your returns, and leaving some in the 123 Lite could make sense if you get cashback - - though it sounds as if you get just £5 a year so it seems hardly worth it.

    A selection of interest rates is under Banking and Saving
    Surely he's earning £65 a year in cashback in order to be £5 up after the monthly fee? A 123 Lite would deliver a net £53 if fully optimising the shunting of funds (from the interest-earning account) to meet DDs....
  • colsten
    colsten Posts: 17,597 Forumite
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    eskbanker wrote: »
    Surely he's earning £65 a year in cashback in order to be £5 up after the monthly fee? A 123 Lite would deliver a net £53 if fully optimising the shunting of funds (from the interest-earning account) to meet DDs....
    Yes you are right, and I have struck out the incorrect conclusion. Thanks for spotting it.

    There's most likely not much sense in keeping £20k in a 123 Lite - you'd still get your £53 if you kept it topped up to cover your monthly DDs. The rest should go into an account that pays more than 1%, and doesn't have any monthly fee.
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