A&L Online Saver/ISA closing & cutting rates

mary

So where's everyone going with their nest eggs?

hansi

ING, for now, until I find something better

Stonk

What's the point in moving to ING, which also pays 5%? I appreciate you want to hurt A&L, but why hurt yourself at the same time?!

Every transfer costs you money, and you should minimise the number of them. Typically transfers between these internet accounts have to go through a current account paying low interest and the minimum time taken is 4 days. That is, I could request the transfer out from A&L on Monday morning, it would appear in my current account on Wednesday, and then I could instruct a second savings account to take it which would happen on Friday (I wouldn't want to cut it finer than this). So you're losing 5% interest for 4 days, which takes 2 months to recoup when your improved interest rate is only 0.31% higher (e.g., the AA account). Two transfers = 2 lots of 4 days without interest = 4 months to recoup.

This applies less if the sums involved are fairly small, because you might be going through a current account that pays good interest. But they have a limit on the balance on which they pay the good rate.

gm_xone

mary wrote:

So where's everyone going with their nest eggs?

I already have a Cahoot Savings Account which is linked to the current account I also have with them.
Whilst the interest rate is only marginally more than what A & L now pay, transfers will (hopefully!) be much quicker between my accounts.

So for now, at least, I'll use Cahoot...
and as for the future...:question:

PS. Does anyone know if transfers between Cahoot accounts are instant?

hansi

Stonk wrote:

What's the point in moving to ING, which also pays 5%? I appreciate you want to hurt A&L, but why hurt yourself at the same time?!

Every transfer costs you money, and you should minimise the number of them. Typically transfers between these internet accounts have to go through a current account paying low interest and the minimum time taken is 4 days. That is, I could request the transfer out from A&L on Monday morning, it would appear in my current account on Wednesday, and then I could instruct a second savings account to take it which would happen on Friday (I wouldn't want to cut it finer than this). So you're losing 5% interest for 4 days, which takes 2 months to recoup when your improved interest rate is only 0.31% higher (e.g., the AA account). Two transfers = 2 lots of 4 days without interest = 4 months to recoup.

This applies less if the sums involved are fairly small, because you might be going through a current account that pays good interest. But they have a limit on the balance on which they pay the good rate.

agreed, but ING do pay monthly interest unlike A&L

isasmurf

nrsql wrote:

A&L isa has a £25 transfer out charge which puts me off it.

Not any more!!! Just a shame they had to wait until they closed it to new customers to remove it. :mad: I guess their not stupid.
ISA new deal from A&L (Moneyextra.com)

muddyfox470

Can i just ask, did anyone see about this interest rate change in any of the national newspapers?

I looked through the Guardian, Telegraph and the Times (at college) and couldn't find a mention. So if any of you have spotted info regarding the rate cuts let me know which papers you saw them in (today - monday).

Thanks

Ian

hansi

No, I haven't seen anything anywhere. I bet if their rates were going up, they would have published it. Maybe today was a good day to bury bad news! Who knows?

Kazza242

muddyfox470 wrote:

Can i just ask, did anyone see about this interest rate change in any of the national newspapers?

I looked through the Guardian, Telegraph and the Times (at college) and couldn't find a mention. So if any of you have spotted info regarding the rate cuts let me know which papers you saw them in (today - monday).

Thanks

Ian

I read about the rate cuts in the Sunday Mail's financial supplement. The Daily Mail and Mail on Sunday are very good at keeping readers up to date on rate changes and new accounts. They have an online edition too.

buses7675

isasmurf wrote:

Not any more!!! Just a shame they had to wait until they closed it to new customers to remove it. :mad: I guess their not stupid.
ISA new deal from A&L (Moneyextra.com)

Hi All,

Now that is good news, just in case A&L go and reduce the rate massively in Jan 06 - Especially as I just got up to 6k in my ISA today!

Was always wary of the £25 charge, but took the risk - Seems it paid off and VERY glad its gone, just hope it doesn't reappear at any point!

Be interesting to see what the 'new' July issue Online Savers and Direct ISAs are, can't see them being much different to the old ones, maybe just have the old 5.35% back on the Online Saver!

Cheers

Steve