Revealed: Santander 123 customers face DOUBLE rate drop – to 1% today and to 0.6% in August

trevjl

fewcloudy said:

I wonder, does Martin Lewis have it in for Santander, lol?!
He seems a bit OTT and shouty, screaming about it being deader than a dead duck etc. it just seems so unnecessary.
Right at the bottom of the same article, he tells you that the (rather obvious) thing to do is to move your account to "the top-pick account for bills cashback", step forward the terribly evil, er, Santander 123 Lite, doh!
There, sorted.  And breathe...

Indeed. I think it all needs updating as its nonsense now.
I have had this for a good few years in the good old 3% days when I had the max £20K in there. Currently, due to Bank of Dad having to fork out I have around £7K in there, with another £6k looking for an easy access home, I decided to close the 123, and move it all elsewhere. Guess what, when I actually looked, there was nothing at 0.6% easy access. Close too it with some obscure sounding bank nobody has ever heard of, but nothing at 6%. My cash back on DD's is just over the £5 a month, so I have come to realise that it is actually not as bad as Mr Lewis makes out (seems a regular thing these days, not the site it once was)

lhsecons

You may not have noticed, but we have been going through a pandemic. One of the consequences is that the Bank of England has engaged in quantitative easing and consequently interest rates have plummeted. You cannot criticise a site today for saying something which was true 8 months ago, even if it isn’t now!!!

trevjl

Agreed, so as I said, its needs updating. But if you look on the best accounts page it doesn't even get a mention. Surely if you have a sizeable amount and enough DD's to cover the monthly fee its a decent account

Doc_N

trevjl said:

Agreed, so as I said, its needs updating. But if you look on the best accounts page it doesn't even get a mention. Surely if you have a sizeable amount and enough DD's to cover the monthly fee its a decent account

Pretty much the conclusion I’ve reached - for now, until the situation changes again.

colsten

If you keep a steady £5K in a current account which pays you £5 a month, that‘s the equivalent of 1.2% AER (ref Halifax Reward). Without doing complicated calculations, I can safely say that my 123 Lite is better value than that. 

I get between £5 and £6 cashback every month in my 123 Lite. I keep my balance below £5K, and often as low as just a few hundred pounds. My surplus sits in a semi-decent 1.2% instant access account*, from which I refill the 123 Lite as required. I know the 1.2% won‘t last forever but I have another 1.05% instant access account* in reserve, so I am hopeful that I can keep the 123 Lite going for some time to come. It‘s obviously a million miles from the haydays of the full fat 123 accounts but also a million miles from a dead 🦆! For people who can get good cashback, the 123 Lite is difficult to beat IMO.

* Sadly, neither of these are now available to new applicants

mgdavid

digalumps said:

I think in some ways we are lucky in this country to have current accounts that don't charge you

I know people in Australia and America for example where they are charged monthly fees to have bank accounts and also individual fees to for example make payments

I have an ordinary Australian current account - no monthly charge, no fees on transactions.

huw01

I still use it as my main current account, after paying the £5 fee im up around £9 per month through interest and cashback which is over £100 per year. That is more than I could get with any other current or savings account with a 20k ish balance. I also have the halifax reward account with pays £5, so it reimburses me the £5 monthly fee Santander charges me. So operating both I manage to average around £168 per year. Better than any of the apparent best buys advertised

crumpet_man

You would get a little bit more by downgrading to 123 lite and using an instant access savings account for the bulk of your 20k but the extra money probably isn't worth the time and effort.

huw01

crumpet_man said:

You would get a little bit more by downgrading to 123 lite and using an instant access savings account for the bulk of your 20k but the extra money probably isn't worth the time and effort.

 yes probably I would but I agree its not worth the faf and by the time i was done guaranteed the instant access savings acc I would open would drop it's rates. Unpopular opinion maybe but I quite like Santander, their app is clear and easy to use. Plus unlike other banks their visa  cashback offers for using my debit card are relevant and useful. Periodic cashback offers at Coop, Morrisons, Costa, Nandos, ATS etc. I remember when I used my 1st Direct account the visa cashback offers always seemed to be on wightlink ferries to the isle of wight - and I'm in North Wales !!
Also the free Santander ATM cash withdrawals in Spain at Banco Santander ATM's is the best out there if you like me usually ( i say excluding 2020) have a few trips to Spain, the Balearics , Canaries etc each year. Even a card like a Starling debit card is no use when all major banks in Spain charge a usage fee for their ATMs (except a few smaller banks or Detuchse Bank which dont have that many branches). Using this has saved me quite a bit in ATM fees over the years

Elmer_BeFuddled

colsten said:

If you keep a steady £5K in a current account which pays you £5 a month, that‘s the equivalent of 1.2% AER (ref Halifax Reward).

Thanks for that. I switched to one for the £100 bonus while it was on and while I'm waiting to switch it on again I may as well add £4.9k to get some "interest" out of it.