Santander 123 interest rate and fee change from April 2021

chistery

From 12th April 2021 the interest rate is dropping form 0.6%AER to 0.3%AER for balances up to £20k.
The monthly fee also drops from £5 to £4.

born_again

Not a shock. 
But good news on the fee reduction

PRAISETHESUN

It's a net gain of £12/yr after fee with a full £20k balance (assuming no cashback) Only a mere £16k balance to break even on the fee. Even a Santander 123 Lite + eSaver (paying 0.05%) is probably a better option than this...

Notepad_Phil

PRAISETHESUN said:

It's a net gain of £12/yr after fee with a full £20k balance (assuming no cashback) Only a mere £16k balance to break even on the fee. Even a Santander 123 Lite + eSaver (paying 0.05%) is probably a better option than this...

I really like the Santander 123 as I've got a bunch of regular savers coming out from it for Mrs Notepad and myself, and filling it up to the max allows me to just let it run on auto for a few months without worrying that it will run out of money - and we are lucky in that our cashback does pay for the fee.

I think I'll wait for a couple of months before deciding what to do as I wouldn't be too surprised if this was just the start of another round of rate cuts from other providers.

where_are_we

I switched from 123 to 123Lite some time ago and link it with a Skipton OS7 (no longer available but paying 1.2%) to fund multiple regular savers. Monthly fee for 123Lite increased recently from £1 to £2 , so I hope this isn`t a prelude to a further 123Lite fee increase. Everything seems to be in a downward spiral!

born_again

Notepad_Phil said:

PRAISETHESUN said:

It's a net gain of £12/yr after fee with a full £20k balance (assuming no cashback) Only a mere £16k balance to break even on the fee. Even a Santander 123 Lite + eSaver (paying 0.05%) is probably a better option than this...

I really like the Santander 123 as I've got a bunch of regular savers coming out from it for Mrs Notepad and myself, and filling it up to the max allows me to just let it run on auto for a few months without worrying that it will run out of money - and we are lucky in that our cashback does pay for the fee.

I think I'll wait for a couple of months before deciding what to do as I wouldn't be too surprised if this was just the start of another round of rate cuts from other providers.

You are aware that even the 123 lite has access to the reg saver acc's.
But get you point that DD's pay the fee.

wiseonesomeofthetime

Access to a 0.50% regular saver!

Whoopee. Sign me up 😂

Catplan

Yeah it’s 0.5 now but it was 2.5% for a period last year. I have one coming to an end this month via the 123Lite....... I won’t be open another though.

wiseonesomeofthetime

Yeah, my latest matured one was at 2%.

whattochoose

I've just used their calculator to check how much I'll be getting after the reduction, based on the amount I have invested and my present cashback payments with them. If I stay with the 123 account, I'll receive £1.59 a month, with the Lite, I'll owe them 40 pence!
I see investing in the saver brings you £6.50 after maturity.
Very slim pickings with Santander now.
I will explore other avenues but it just seems like a desert out there.

huw01

whattochoose said:

I've just used their calculator to check how much I'll be getting after the reduction, based on the amount I have invested and my present cashback payments with them. If I stay with the 123 account, I'll receive £1.59 a month, with the Lite, I'll owe them 40 pence!
I see investing in the saver brings you £6.50 after maturity.
Very slim pickings with Santander now.
I will explore other avenues but it just seems like a desert out there.

I've done the same and come out with around £4 up each month, so £48 per year. It is still better than any other current account out there. I also run the Halifax reward alongside it to get the free fiver a month. Running both will get me £108 per year.