Santander 123 options

colsten

where_are_we said:

Thanks Colsten. Switching or moving DD`s is not an option - we would lose £6 cashback each month. Changing from full123 to 123 lite is difficult for us. We have always had a large balance to cover monthly regular saver SO`s (£14000 each month) plus current account SO`s (2Lloyds 4Tsb and 2Halifax) as well as the DD`s. In a123 lite we would need to keep as low a balance as possible. A lot of our RS SO`s are at the beginning of the month and we could move the non calendar month ones to the beginning of the month (with a one off loss of interest) so that a large manual transfer from Marcus at the end of the month would cover the RS SO`s. The further reduction in August to .6% means we will "risk" upgrading to 123 lite despite the "work" involved.

I understand your situation as it's not dissimilar to mine. All I would say in conclusion: do your numbers in a spreadsheet, so you can decide the best alternative for yourself. Don't get worked up about a few pennies here or there. Settle for the least worst.

Notepad_Phil

colsten said:

where_are_we said:

Thanks Colsten. Switching or moving DD`s is not an option - we would lose £6 cashback each month. Changing from full123 to 123 lite is difficult for us. We have always had a large balance to cover monthly regular saver SO`s (£14000 each month) plus current account SO`s (2Lloyds 4Tsb and 2Halifax) as well as the DD`s. In a123 lite we would need to keep as low a balance as possible. A lot of our RS SO`s are at the beginning of the month and we could move the non calendar month ones to the beginning of the month (with a one off loss of interest) so that a large manual transfer from Marcus at the end of the month would cover the RS SO`s. The further reduction in August to .6% means we will "risk" upgrading to 123 lite despite the "work" involved.

I understand your situation as it's not dissimilar to mine. All I would say in conclusion: do your numbers in a spreadsheet, so you can decide the best alternative for yourself. Don't get worked up about a few pennies here or there. Settle for the least worst.

I'm in the same boat as well. In my case I'm tending towards keeping the full-fat Santander because of the simplicity that it brings and that simplicity wins out over the relatively small amount of pounds over the year that I'll lose compared to the interest coming from all the regular savings accounts that it pays into - though my decision may have been a bit harder if I had been in the situation where the cashback was not paying off the £5 monthly fee.

I could always split my umpteen standing orders across multiple higher interest current accounts, but keeping on top of all the accounts and the standing orders and direct debits within would bring additional hassle and I'm at the age where I'm starting to try to simplify some things.

Also in my case, I'm sure that as soon as I'd rearranged everything then those banks would reduce their interest rate too! 

soulsaver

Ok For those that say it's too complicated to run your 123 as a lite 'hub' and bump upto £20k elsewhere to earn better than 0.6% - here is my (our) regime - maybe it'll help some:

We each have own c/as for our personal expenditure cars, car tax, insurance, repairs etc.

We have a joint 123 lite ac for household bills and DDs, weekly shop etc. We pay in a 'safe' c. £1000 at the start of the month for the varying dates DDs and weekly shopping. 
That is left to earn cash back and pay £1pm fee... pennies in interest.. but that's OK.

In addition I have solo 123 lite into which pay in the funds for all my SOs reg savers etc. which almost all have been set up to go out on nap one day, 3rd or 4th of the month. For me that's about 24 SOs c.£15K . 

So at the start of the month (diarised reminder) I manually transfer that c.£15k from whichever is my lowest paying easy access/current acs - so I have a run around my various accounts and mop up owt that's paying nowt that's appeared in the month that I didn't immediately deal with (balances from maturing RSs, Pension, Annuity, rate reductions, interest) then the balance (lately) comes from Marcus. 

I don't find that takes much time - the key to it being simple is knowing how much you pay out in SOs and, as Colsten said, a spreadsheet updated with the birth and demise of RSs & other SOs is a great help. 

This account has no DDs.

schiff

There seem to be so many who have become really attached to Santander over the years for its convenience and efficiency. It has been the saddest drop in an interest rate for me. In retirement there is plenty of time to monitor your cash, even on a daily basis, so come August it will just mean more precise movement of funds to the Lite.

Notepad_Phil

soulsaver said:

So at the start of the month (diarised reminder) I manually transfer that c.£15k from whichever is my lowest paying easy access/current acs - so I have a run around my various accounts and mop up owt that's paying nowt that's appeared in the month that I didn't immediately deal with (balances from maturing RSs, Pension, Annuity, rate reductions, interest) then the balance (lately) comes from Marcus. 

Unfortunately the manual bit is where it falls down for me. Mrs Notepad has no interest in any of this, so it's left to me to deal with the moving of money to pay all the monthly savers etc. So just in case I'm ever out of action (hopefully just short term) I want things to be as automatic as possible. A fully loaded 123 allows me the luxury of everything being automatic for a couple of months, in which time I'm hopefully back on my feet and can top it back up again.

soulsaver

Notepad_Phil said:

soulsaver said:

So at the start of the month (diarised reminder) I manually transfer that c.£15k from whichever is my lowest paying easy access/current acs - so I have a run around my various accounts and mop up owt that's paying nowt that's appeared in the month that I didn't immediately deal with (balances from maturing RSs, Pension, Annuity, rate reductions, interest) then the balance (lately) comes from Marcus. 

Unfortunately the manual bit is where it falls down for me. Mrs Notepad has no interest in any of this, so it's left to me to deal with the moving of money to pay all the monthly savers etc. So just in case I'm ever out of action (hopefully just short term) I want things to be as automatic as possible. A fully loaded 123 allows me the luxury of everything being automatic for a couple of months, in which time I'm hopefully back on my feet and can top it back up again.

That's a fair point... same here... Especially in these uncertain times. And Mrs S is same.
I'll have to look if I can find a contingency for that.

colsten

Notepad_Phil said:

soulsaver said:

So at the start of the month (diarised reminder) I manually transfer that c.£15k from whichever is my lowest paying easy access/current acs - so I have a run around my various accounts and mop up owt that's paying nowt that's appeared in the month that I didn't immediately deal with (balances from maturing RSs, Pension, Annuity, rate reductions, interest) then the balance (lately) comes from Marcus. 

Unfortunately the manual bit is where it falls down for me. Mrs Notepad has no interest in any of this, so it's left to me to deal with the moving of money to pay all the monthly savers etc. So just in case I'm ever out of action (hopefully just short term) I want things to be as automatic as possible. A fully loaded 123 allows me the luxury of everything being automatic for a couple of months, in which time I'm hopefully back on my feet and can top it back up again.

I am sorry if this sounds a bit morbid, but you are aware that your scheme has a fundamental flaw? You have not made provision for the eventuality that you will not be back in a couple of months, or ever.

ratechaser

schiff said:

There seem to be so many who have become really attached to Santander over the years for its convenience and efficiency. It has been the saddest drop in an interest rate for me. In retirement there is plenty of time to monitor your cash, even on a daily basis, so come August it will just mean more precise movement of funds to the Lite.

Agreed, historically I've seen good 123 interest, cashback, mortgage and ISA rates. Even to the point where I could make money taking funds out of the mortgage and plonking them into savings accounts. Free overseas withdrawals, a decent website and app for usability, and always able to get hold of them on the phone quickly.

I suppose looking at it that way, I'm lucky that I got 15 years out of them. Was never going to be sustainable, and even less so right now.

Notepad_Phil

colsten said:

Notepad_Phil said:

soulsaver said:

So at the start of the month (diarised reminder) I manually transfer that c.£15k from whichever is my lowest paying easy access/current acs - so I have a run around my various accounts and mop up owt that's paying nowt that's appeared in the month that I didn't immediately deal with (balances from maturing RSs, Pension, Annuity, rate reductions, interest) then the balance (lately) comes from Marcus. 

Unfortunately the manual bit is where it falls down for me. Mrs Notepad has no interest in any of this, so it's left to me to deal with the moving of money to pay all the monthly savers etc. So just in case I'm ever out of action (hopefully just short term) I want things to be as automatic as possible. A fully loaded 123 allows me the luxury of everything being automatic for a couple of months, in which time I'm hopefully back on my feet and can top it back up again.

I am sorry if this sounds a bit morbid, but you are aware that your scheme has a fundamental flaw? You have not made provision for the eventuality that you will not be back in a couple of months, or ever.

You bring up a valid point which does need to be considered. Mrs Notepad is aware at a very high level of what goes on, and she is aware of where the details of accounts, standing orders, etc are held offline, so if anything should happen then Mrs Notepad with help from tech savvy children will be able to fumble their way through what needs doing, even if that just means deleting the standing orders to the monthly savers so that the big drains on the account get removed.

MinuteNoodles

Just to let you all know Marcus has announced a drop in their interest rate to 1.02% as of the 30th May. Might want to stop suggesting Marcus as an alternative. I suspect they'll drop them again in September.