Keep switching around as finding better interest rates?

silvermum

A few years ago I realised I was spending too much time chasing tiny percentage increases worth only a few tens of pounds over a year. I've scaled it back and now shuffle my money between 3 or 4 providers who usually offer good, if not the absolute best rates e.g. Marcus, Virgin, Paragon etc
One of my key criteria is the ease of operation of their websites/ apps. Paragon is driving me mad as their website makes you login twice - seems to automatically time out after the first attempt! Grr...

AmityNeon

silvermum said:

A few years ago I realised I was spending too much time chasing tiny percentage increases worth only a few tens of pounds over a year. I've scaled it back and now shuffle my money between 3 or 4 providers who usually offer good, if not the absolute best rates e.g. Marcus, Virgin, Paragon etc
One of my key criteria is the ease of operation of their websites/ apps. Paragon is driving me mad as their website makes you login twice - seems to automatically time out after the first attempt! Grr...

You need to manually log out each time (or clear cookies), otherwise when you next try to log in, the website will log you in to the previous session which has already timed out. Other providers like Aldermore, Ford Money and Gatehouse Bank have the same quirk because they all utilise the same underlying system.

jimjames

auser99 said:

wmb194 said:

auser99 said:

martyp said:

Thanks boingy, much appreciated. I like the rates I'm getting at the moment. The best ones do seem to be the ones with a monthly limit. I was kicking myself with one when I withdrew a fair amount then they hiked up the interest rate unexpectedly so have been filling it up again.
I've hesitated to on long term fixes in case I may need the money for anything.

But generally, fixed bonds will produce higher interest over a year as a whole, which some may miss as they'll just see the apparatent (sic) higher interest rate offered on the ,monthly limit accounts.

No, you'll always earn more with the higher rate.

Maybe we're talking slightly different scenarios.

If you have £100, then clearly 6% will get you more than 5%.

But if you put in £100 a month limit at 6%, you'll get less over a year, than you would putting in £1200 in one go at 5% in a fixed bond.

You're making the assumption that £1200 is getting zero interest until it's put into the account which is not very realistic. Many people only have monthly savings with their wages so regular savers are ideal for that scenario. In other ones you can just move the money from the best instant access to the reg saver so money at 3.82% moving to 6% over the course of a year.

auser99

jimjames said:

auser99 said:

wmb194 said:

auser99 said:

martyp said:

Thanks boingy, much appreciated. I like the rates I'm getting at the moment. The best ones do seem to be the ones with a monthly limit. I was kicking myself with one when I withdrew a fair amount then they hiked up the interest rate unexpectedly so have been filling it up again.
I've hesitated to on long term fixes in case I may need the money for anything.

But generally, fixed bonds will produce higher interest over a year as a whole, which some may miss as they'll just see the apparatent (sic) higher interest rate offered on the ,monthly limit accounts.

No, you'll always earn more with the higher rate.

Maybe we're talking slightly different scenarios.

If you have £100, then clearly 6% will get you more than 5%.

But if you put in £100 a month limit at 6%, you'll get less over a year, than you would putting in £1200 in one go at 5% in a fixed bond.

You're making the assumption that £1200 is getting zero interest until it's put into the account which is not very realistic. Many people only have monthly savings with their wages so regular savers are ideal for that scenario. In other ones you can just move the money from the best instant access to the reg saver so money at 3.82% moving to 6% over the course of a year.

I retried using this scenario, and you're right, albeit marginally

Month 1 £100  at 6% and £1100 at 3.82%, moving £100 each month from that £1100, to  the 6% account.

I make it £60.76 v £60 ( 1 year fixed at 5%)

It is making an alternative assumption that both the 6% and 3.82% accounts will stay that high for 12 months (former may be, latter may not).


Additionally, using the 6.17% the other poster had used, and comparing to the 5.16% Shawbrook offer for 1 year, the fixed bond would actually win out by.... 1p.

I understand that many only have xx available each month / don't want to lock down etc.
Always interesting to look into these ins and outs.

silvermum

AmityNeon said:

You need to manually log out each time (or clear cookies), otherwise when you next try to log in, the website will log you in to the previous session which has already timed out. Other providers like Aldermore, Ford Money and Gatehouse Bank have the same quirk because they all utilise the same underlying system.

Thank you! I thought it was an error in their system coding!

housebuyer143

jimjames said:

auser99 said:

wmb194 said:

auser99 said:

martyp said:

Thanks boingy, much appreciated. I like the rates I'm getting at the moment. The best ones do seem to be the ones with a monthly limit. I was kicking myself with one when I withdrew a fair amount then they hiked up the interest rate unexpectedly so have been filling it up again.
I've hesitated to on long term fixes in case I may need the money for anything.

But generally, fixed bonds will produce higher interest over a year as a whole, which some may miss as they'll just see the apparatent (sic) higher interest rate offered on the ,monthly limit accounts.

No, you'll always earn more with the higher rate.

Maybe we're talking slightly different scenarios.

If you have £100, then clearly 6% will get you more than 5%.

But if you put in £100 a month limit at 6%, you'll get less over a year, than you would putting in £1200 in one go at 5% in a fixed bond.

You're making the assumption that £1200 is getting zero interest until it's put into the account which is not very realistic. Many people only have monthly savings with their wages so regular savers are ideal for that scenario. In other ones you can just move the money from the best instant access to the reg saver so money at 3.82% moving to 6% over the course of a year.

This is what I have done. Put the bulk of my savings in fixed bonds, easy access and now any money I want to save monthly from my wages goes into my 4 regular savers paying from 5.5%-7.5%. These 4 accounts are enough to cover amount I have available to save, so putting it here seems the best for me. 

jaypers

Apathy amongst savers probably encourages apathy amongst the institutions themselves. I would like to think that the more people who ditch and switch prompts these banks to increase their rates sooner. Really wish everyone was ruthless in their approach on this. I feel like I’m moving money every couple of weeks. Also quite enjoy it. 

wmb194

auser99 said:

wmb194 said:

auser99 said:

martyp said:

Thanks boingy, much appreciated. I like the rates I'm getting at the moment. The best ones do seem to be the ones with a monthly limit. I was kicking myself with one when I withdrew a fair amount then they hiked up the interest rate unexpectedly so have been filling it up again.
I've hesitated to on long term fixes in case I may need the money for anything.

But generally, fixed bonds will produce higher interest over a year as a whole, which some may miss as they'll just see the apparatent (sic) higher interest rate offered on the ,monthly limit accounts.

No, you'll always earn more with the higher rate.

Maybe we're talking slightly different scenarios.

If you have £100, then clearly 6% will get you more than 5%.

But if you put in £100 a month limit at 6%, you'll get less over a year, than you would putting in £1200 in one go at 5% in a fixed bond.

£1200 at 5% gets you £60 over a year
£100 a month compounding at 6% gets you £40.25 over a year

No, you're talking about a lump sum that's being drip fed into a regular saver, and you're also assuming that it won't earn any interest before it reaches the regular saver. What you do - and particularly if we're only talking about £1,200! - is open multiple regular savers at a rate >5%. If you have the inclination to manage lots of accounts and you want to maximise your interest, go for the best rate.

ColdIron

jaypers said:

I would like to think that the more people who ditch and switch prompts these banks to increase their rates sooner. Really wish everyone was ruthless in their approach on this.

I take the opposite view. Many banks offer very attractive rates in the knowledge that most people won't take advantage of them. If more people were more proactive they wouldn't offer such high rates and we rate tarts would suffer

Essentially the apathetic are cross subsidising us and long may it continue

Bridlington1

ColdIron said:

jaypers said:

I would like to think that the more people who ditch and switch prompts these banks to increase their rates sooner. Really wish everyone was ruthless in their approach on this.

I take the opposite view. Many banks offer very attractive rates in the knowledge that most people won't take advantage of them. If more people were more proactive they wouldn't offer such high rates and we rate tarts would suffer

Essentially the apathetic are cross subsidising us and long may it continue

I would sit somewhere in the middle here. If everyone was a rate tart the banks would be unwilling to offer any loss leaders/market leading rates since they'd be pounced upon with the banks getting little if anything in return. On the flip side if everyone was stubbornly sticking with one bank and would not move their money to get a higher rate for love nor money there would also be little benefit to the banks for offering loss leaders/market leading rates since their customers will not leave no matter what the banks offer.

I would say to really maximise the attractiveness of rates and create the optimum conditions for us rate tarts you would need something in between, i.e. the majority to be reluctant to move their savings but at the same time also be prepared to move their money if they feel the banks are taking the Michael with offering low savings rates for too long. This way the banks still make money from loyal customers but at the same time they can still bag new customers by offering competitive products and loss leaders