Bank account overhaul - Is this the best option?

Sunshine_and_Roses

I have been with Santander for years but due to the interest drop I am ready to change. Can you advise if the below would be a good alternative?
Our main account for bills etc has an average balance of £10,000.  I have calculated that the cashback when the changes are made next month on the 123 accounts will be around £4.20 per month.  0.6% interest would be approx £4 per month, but the account fee is £5 a month.  Would it be better to change this to a 123 Lite which would still give a couple of quid after the £2 fee, and move the rest to a NS&I or even another Lloyds Club? (I know I would not be able to get another switch incentive though).
I was thinking of switching my current account to Lloyds Club to take advantage of the switch incentive, leave a balance of £5000 in for the interest.  I have just switched a dormant account to Halifax rewards for the switch incentive, so maybe put £5000 in this for the £5 a month bonus then the remainder in NS&I.
I have £1500 in a TSB account, and had previous accounts with Nationwide Flex so cannot take advantage of their bonus interest rate again.
Does this sound like a plan, or is there a better option for me?
Thanks for any advice

colsten

Downgrading the 123 to a 123 Lite is what lots of people, incl myself, have done a while back. Move surplus funds to a better paying account, such as Virgin and NS&I [Income Bonds and/or Direct Saver]. No need to keep £5K in Halifax to get the monthly fiver there, though it might be more convenient for you to do so (see the Halifax thread). Personally, I wouldn't keep a penny in a Club Lloyds at their current rates. But you need to do what works best for you.

PRAISETHESUN

I agree with downgrading to 123 Lite and throwing the rest of your savings into the highest rate accounts you have available to you. There are better rates than Club Lloyds so make sure to shop around. If you can meet the Halifax debit card spend then there's no need to keep £5k in the account to get the reward, so it can earn interest elsewhere.
https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/

mrkds

I agree with @PRAISETHESUN re Halifax account,  better to spend £500 on the debit card than keep £5000 balance. If you get a NS&I savings account, I think they accept deposits via debit card, so you can  deposit £500 in there with the debit card once a month, and then shuffle the money back around for the following month. That gets you the £5/mo reward and the remaining £4500 can go somewhere with better returns.

funkycredit

I've got accounts everywhere to try and get the best rates. Some, I'm being cheeky with (but succeeding) and so far everything seems ok and I'm earning a few quid every month for minimal time moving money. Best accounts I've got for interest etc are as follows - 

- virgin x3 (keep £1k in each. No requirements);
- TSB Classic Plus x2 (£1500 in each - move both to Halifax and then to NatWest  - see below)
- Halifax Rewards x2 (Pay in £1500 to each from TSB then move £2k into NatWest (see below) and keep £1k to use 2x 2 £250 deposits into PO Savings (meets the £500 x2 debit card requirement))
- NatWest rewards x2 - pay in £1250 and have 2x DD's and pay small fee (DD's are 1x PO account each and an Amex card each)
- Move NatWest & PO money back to main account and top up TSB. 

I've got a lot more than that going on but with the Barclays blue, nationwide, Co-Op and club Lloyd's etc there's a few quid to be made for sure. 👍

TheMightySwordfish

Have you got a figure for your income from this? 

funkycredit

TheMightySwordfish said:

Have you got a figure for your income from this? 

Well, as we double it up (wife included) and the fact we've a few grand floating in cyberspace (PO money)  - yes (and no)! I mean some are new, like the 2x rewards and Halifax £5 deal (opened 2 of each, each). But with all the others we get 6 cinema tickets, £20 from Halifax, £15 from TSB, £15 from Santander, £10.20 from virgin then the Co-Op and Barclays plus new RBS rewards and NatWest rewards (still only couple weeks old). 

I'll work it all out properly and post up in October when hopefully everything's been paid! Right now I'm all over the place as we've opened a lot of new accounts since August (over 15 each)! 

TheMightySwordfish

Nice haul by the sounds of it.
I need to work on getting accounts up for swapping. I have a few (Nationwide, Halifax, RBS, a couple of Virgin Money) that are worth keeping hold of at the moment. Have swapped my Monzo, Starling and TSB. I guess I could swap a Virgin Money if really needed. 

Blackbeard_of_Perranporth

You have £10,000 and get £4.20 for it!

I have not than much, but my isa for this year on £1,000 made £7.21 last month!

TheMightySwordfish

I think only £3k is stationary the rest is the same £1500 being moved about from the looks of it. 

colsten

Blackbeard_of_Perranporth said:

You have £10,000 and get £4.20 for it!

How did you work this out?