Santander 123

RobM99

I have £20,000 in a 123, earning 0.6% p.a. but £60 a month fees. (So £60 a year nett).
I'm looking at switching i to an Everyday current account (No interest, no fees) instead of the 123 and moving the money to a 0.8% ISA. (£160 a year nett). Am I missing something or is this a better move?

PRAISETHESUN

I'd definitely move your cash and downgrade as that's been the best option for a while. If you still want the cashback you can downgrade to 123 Lite, but you need to make sure you get at least £2/month cashback to break even with the fee. Otherwise you can downgrade to an Everyday account with no monthly fee, but also no cashback. You'll also no longer be eligible for any 123 exclusive products in the future (eg. regular savers, credit cards, etc).

[Deleted User]

It's not simply £60 net as you can get the 123 cashback which the free account doesn't offer.
Check the other options including 123 Lite and make your own mind up.

born_again

With the regular e-saver now down to 0.5% it is not worth it.

What DD's do you earn cashback on? As that is the only choice between 123 light & everyday acc's

RG2015

born_again said:

With the regular e-saver now down to 0.5% it is not worth it.

What DD's do you earn cashback on? As that is the only choice between 123 light & everyday acc's

https://www.santander.co.uk/personal/current-accounts/123-lite-current-account

You get cashback on utility and telecoms bills and this cashback and the monthly fee are the main differences.

The 123 Lite also gives access to 123 World benefits although these are pretty small fry now.

RobM99

Thanks all, I earn £5 a month on cash-back, so by my calc's I'd be £40 a year better off moving. Not a fortune! The Lite option would be the worst, moneywise.

NottinghamKnight

RobM99 said:

Thanks all, I earn £5 a month on cash-back, so by my calc's I'd be £40 a year better off moving. Not a fortune! The Lite option would be the worst, moneywise.

But £5 cashback minus £2 fee means you would get £3 net from a lite account, though at a small cost of retaining sufficient balance to service the direct debit. The rest of your balance could then be earning interest in the best available savings account as well.

RobM99

NottinghamKnight said:

RobM99 said:

Thanks all, I earn £5 a month on cash-back, so by my calc's I'd be £40 a year better off moving. Not a fortune! The Lite option would be the worst, moneywise.

But £5 cashback minus £2 fee means you would get £3 net from a lite account, though at a small cost of retaining sufficient balance to service the direct debit. The rest of your balance could then be earning interest in the best available savings account as well.

Ah yes, I was thinking keeping the whole £20,000 in the Lite!   (Turns brains on!)

Geordie_bear

RobM99 said:

I have £20,000 in a 123, earning 0.6% p.a. but £60 a month fees. (So £60 a year nett).
I'm looking at switching i to an Everyday current account (No interest, no fees) instead of the 123 and moving the money to a 0.8% ISA. (£160 a year nett). Am I missing something or is this a better move?

I'd try the Marcus easy access account by Goldman sachs I get around £30 a month on £33k so you should get around £18 on £20k much better then Santander.

colsten

A fixed term Marcus (which is all you can get from them at present) is not the best idea at 0.5% when you can still easily get 0.8% on easy access accounts.

@RobM99, you might still get 1% in an easy access ISA. Although you don't get a tax advantage if the only interest you earn is from £20,000, but it seems the best instant access deal that's still available for new applicants.

Your other option would be to feed your money into Regular Savers. Not all of these allow access before maturity, which may or may not be an issue for you.

RG2015

Geordie_bear said:

RobM99 said:

I have £20,000 in a 123, earning 0.6% p.a. but £60 a month fees. (So £60 a year nett).
I'm looking at switching i to an Everyday current account (No interest, no fees) instead of the 123 and moving the money to a 0.8% ISA. (£160 a year nett). Am I missing something or is this a better move?

I'd try the Marcus easy access account by Goldman sachs I get around £30 a month on £33k so you should get around £18 on £20k much better then Santander.

For £33k, Marcus Easy Access currently pays; £33,000 @ 0.70% / 12 = approx £19 per month. Also, it is not currently open to new users.