Santander 123

Michael_Bear

If you've got a Santander 123 and have a Santander mortgage of over 500pm is it worth still keeping the account as your current account as 1% covers the monthly fee.
The change now being that you should live any excess money out into high interest options?
If I should be doing something else let me know but the mortgage cashback makes me think I should stay!

YorkshireBoy

Michael_Bear said:

If I should be doing something else let me know...

What you should be doing is reading the dozens of other threads on this and the savings board asking the same question.

For most people this account hasn't been worth it for a while now. I moved out nearly 2 years ago and downgraded to Lite.

Zanderman

Michael_Bear said:

If you've got a Santander 123 and have a Santander mortgage of over 500pm is it worth still keeping the account as your current account as 1% covers the monthly fee.
The change now being that you should live any excess money out into high interest options?
If I should be doing something else let me know but the mortgage cashback makes me think I should stay!

Have you read the advice on the main MSE site:  https://www.moneysavingexpert.com/news/2020/05/santander-slashes-interest-on-its-123-account-again-to-0-6-/
And read the forum for the numerous existing threads on the subject?
The obvious thing to do - but read it up first - is to change the 123 account to a 123 Lite account. 
Lower fee, same cashback. Saves you £4 a month.
No interest though - but you can easily get better interest elsewhere.
But do look at other threads on the subject - no need to start yet another one!

inspectorperez

Zanderman said:

Michael_Bear said:

If you've got a Santander 123 and have a Santander mortgage of over 500pm is it worth still keeping the account as your current account as 1% covers the monthly fee.
The change now being that you should live any excess money out into high interest options?
If I should be doing something else let me know but the mortgage cashback makes me think I should stay!

Have you read the advice on the main MSE site:  https://www.moneysavingexpert.com/news/2020/05/santander-slashes-interest-on-its-123-account-again-to-0-6-/
And read the forum for the numerous existing threads on the subject?
The obvious thing to do - but read it up first - is to change the 123 account to a 123 Lite account. 
Lower fee, same cashback. Saves you £4 a month.
No interest though - but you can easily get better interest elsewhere.
But do look at other threads on the subject - no need to start yet another one!

Excellent article and sound advice if I may say.

I hope Santander know what they are doing with this latest interest reduction on the 123 account as there is bound to be a large outflow of customer funds reducing down from £20K balance to something much smaller.

I noticed that when I moved to 123 Lite, my overdraft limit remained the same. I had half been expecting it to disappear altogether!

Oldchap

Thanks to Martin Lewis I found that the interest rate on our 123 accounts is now 1%. I keep all emails from Santander over the last 7 years  and  was never informed of this. Todays emails about a further interest reduction in August all arrived. Just interested if others were not informed in accordance with FCA rules. (I have heard some got a letter and not an email).   The result was a panic closure of all 123 accounts and sorting out  five Direct Debits

Michael_Bear

Cheers for all the replies. Switched to lite account as seemed optimium solution.

Boa21

The 123 account at 0.6% interest is now pretty good for an easy access savings account!
The cashback on DDs more than covers the montly fee so it's quite a handy place for savings I don't want to lock away.