HSBC Regular Saver - Changing SO to 1st

AmityNeon

Section62 said:

AmityNeon said:

wmb194 said:

It's always been possible but the question was whether HSBC paid interest on amounts deposited prior to the monthiversary. The answer used to be 'no' but in a recent thread a poster said that it does (now?) work.

I haven't personally seen any evidence of where this 'no' answer originated. In practice, it would be exceptionally precise programming for no specific reason (i.e. clause/term). Even if that were somehow the case, if you amend the deposit schedule to the first of each month, whether via manual internal transfers or recreating the SO, the worst that could happen is HSBC just calculates interest in accordance with the original SO date.

When I tried to change the SO date in 2017 they told me this -

(The reference to the 28th is the account opening anniversary)

I wouldn't consider that evidence. Considering the context, the statement, "Any additional time that funds spend in the Regular Saver will accrue interest, but not at the preferential rate", is easily interpreted as, "After 12 months, funds will accrue interest at the default rate."

This is common practice for any Regular Savings Account that transitions into a standard easy-access account, or where (in certain cases with First Direct) the process of maturity can take several days, and during the additional days where funds cannot be accessed, interest continues to accrue, but not at the preferential rate.

Section62 said:

Their exceptionally precise programming not only meant they didn't add interest at the headline rate for the extra days, it went a step further and calculated interest on that sum at a different rate.  This matched their T&Cs to the letter.

Their T&Cs state interest is "calculated daily" and their FAQ (as of today) elaborates on this:

The interest rate is fixed for 12 months and calculated on daily cleared balance and paid on the anniversary of account opening.

It would be, truly, exceptionally precise, to pointedly program a method of interest calculation that specifically ignored additional deposits (made between monthly anniversary dates) that increased the account balance above the permitted monthly contribution limit. I also highly doubt they would apply different rates of interest to separate parts of the account balance because it's a savings account, not a credit facility where transactions are categorised and delineated with specific rates.

In the absence of an evidential interest figure that is proven to be undercalculated when weighed against the corresponding balance history, it is far more likely that interest is calculated daily on cleared balances, i.e. a single rate for the whole account balance each day.

Section62 said:

The issue is that the interest rate paid on sums in excess of what should be in the account (i.e. SO's paid before the anniversary date) is so low there is no benefit to be gained by changing the SO date... unless of course the people who say they got additional interest (at the headline rate) are correct.

There are several forumites who would be more than happy to provide their interest figures when their Regular Savers with HSBC and First Direct mature this year, to draw a definitive line under the matter.

Tangible evidence, instead of generic statements in a letter sent to a single customer in 2017.

masonic

Has nobody tried it prior to this year? Appreciate the rates on offer haven't been great for a period of time.

wmb194

masonic said:

Has nobody tried it prior to this year? Appreciate the rates on offer haven't been great for a period of time.

Yes, they had. People with better searching skills than me but be able to find them but I'm sure they reported back that they didn't receive any extra interest. Things can change but, as you know, collectively this forum has always been pretty hot on this sort of thing and there's a reason why people haven't pursued this before.

AmityNeon

masonic said:

Has nobody tried it prior to this year? Appreciate the rates on offer haven't been great for a period of time.

Yes. I linked to two previous reports by different people who confirmed (without figures) that extra interest was received, one of whom even comfortably surpassed the £3K 'maximum balance' via an additional SO.

intalex

I'm going to give it a try, so I should have an answer with some evidence in about a year's time :-)

AmityNeon

wmb194 said:

masonic said:

Has nobody tried it prior to this year? Appreciate the rates on offer haven't been great for a period of time.

Yes, they had. People with better searching skills than me but be able to find them but I'm sure they reported back that they didn't receive any extra interest. Things can change but, as you know, collectively this forum has always been pretty hot on this sort of thing and there's a reason why people haven't pursued this before.

You may think this forum is pretty hot on this sort of thing, but it doesn't help when others continue to ignore or dismiss those who do report anecdotal experiences of extra interest being received.

I used to repeat what I believed was common knowledge on this forum, that HSBC and First Direct operate differently, that their RS accounts were essentially 'set and forget'. Then @piker57 (recently) revealed their experience as being contrary to what I had previously understood, which incentivised me to cancel my original SOs and shift deposits to the beginning of each month. I lose nothing by having tried, and it's allowed me to gain better insight into the nuances of how the accounts operate beyond published T&Cs.

masonic

AmityNeon said:

masonic said:

Has nobody tried it prior to this year? Appreciate the rates on offer haven't been great for a period of time.

Yes. I linked to two previous reports by different people who confirmed (without figures) that extra interest was received, one of whom even comfortably surpassed the £3K 'maximum balance' via an additional SO.

I don't think I'd risk doing what Bridlington did (sounds like doubling up on the monthly deposits), but that does muddy the waters with respect to what we are discussing in this thread. No offence intended to the other poster, but there are a limited number of posters I would trust implicitly to do the sums correctly. My FD regular saver will be maturing in the coming days, and I will have the opportunity to give it a try for the next one (ideally without a SO). I see it as too much risk for a couple of quid extra interest as things stand.

AmityNeon

masonic said:

AmityNeon said:

masonic said:

Has nobody tried it prior to this year? Appreciate the rates on offer haven't been great for a period of time.

Yes. I linked to two previous reports by different people who confirmed (without figures) that extra interest was received, one of whom even comfortably surpassed the £3K 'maximum balance' via an additional SO.

I don't think I'd risk doing what Bridlington did (sounds like doubling up on the monthly deposits), but that does muddy the waters with respect to what we are discussing in this thread.

It doesn't matter that the deposit method was via an accidental SO that may or may not have been scheduled for the account's monthly anniversary; if extra interest was received, it means the daily interest calculations factored in the 'excess' balance above the cumulative monthly contribution limits.

masonic said:

My FD regular saver will be maturing in the coming days, and I will have the opportunity to give it a try for the next one (ideally without a SO). I see it as too much risk for a couple of quid extra interest as things stand.

If you attempt a one-off internal transfer to a First Direct RS, you will receive a non-descriptive error message when attempting to complete the transaction.

masonic

AmityNeon said:

masonic said:

AmityNeon said:

masonic said:

Has nobody tried it prior to this year? Appreciate the rates on offer haven't been great for a period of time.

Yes. I linked to two previous reports by different people who confirmed (without figures) that extra interest was received, one of whom even comfortably surpassed the £3K 'maximum balance' via an additional SO.

I don't think I'd risk doing what Bridlington did (sounds like doubling up on the monthly deposits), but that does muddy the waters with respect to what we are discussing in this thread.

It doesn't matter that the deposit method was via an accidental SO that may or may not have been scheduled for the account's monthly anniversary; if extra interest was received, it means the daily interest calculations factored in the 'excess' balance above the cumulative monthly contribution limits.

Yes, I see you have a point there. Whatever date the additional deposit was made, it is evidence that a second payment made prior to the monthversary does earn interest.

AmityNeon said:

masonic said:

My FD regular saver will be maturing in the coming days, and I will have the opportunity to give it a try for the next one (ideally without a SO). I see it as too much risk for a couple of quid extra interest as things stand.

If you attempt a one-off internal transfer to a First Direct RS, you will receive a non-descriptive error message when attempting to complete the transaction.

Thanks, that clears that one up!

changearound1

I brought forward my SO to the first of the month for payments 2-12 a few years ago and didn't gain any extra interest . My understanding was that the extra few days were having interest applied at 0.05%, as quoted in Section 62's post at the top of page 2, thereby not increasing the final total.

I don't think I tried a 13th payment because the T&Cs explicitly stated a maximum of £3000.