Any improvements to this set of accounts?

hugheskevi

My wife and I have been overseas for some time but will soon be returning to the UK. In preparation for this, I have been reviewing the latest bank accounts and credit cards to determine what the optimal set-up for me will be upon my return. Grateful if anyone can see anything I might have overlooked. My conclusions are:

Bank accounts:
Natwest Premier Reward account (joint) - £8 (net) of cashback each month. This would be our main bank account for everything.

Chase x 2, one in my name, one in my wife's name (as Chase doesn't do joint accounts) - secondary bank accounts in case of any issues with the primary account or credit cards, and a useful account for overseas spending. I expect them to be largely unused.

Credit cards:
Barclaycard Platinum (21 months 0% on purchases, me primary cardholder, wife secondary holder) - Given current cash interest rates, it seems better to build up a 0% balance on this card (which can later be switched to another 0% card) and keep more money in interest bearing accounts, rather than use the Chase card for expenditure at 1% cashback. This would be used for all of both my own and my wife's spending.

Barclaycard Rewards (wife primary holder, me secondary) - a good card for overseas cash withdrawals and a secondary card in case of issues with the primary card (not ideal for this given they are both Barclaycard, but Chase also provides good contingency, so this is held mostly for overseas travel)

Other accounts
I also considered Santander Edge account for household bills, but I think the net gain would only be around £10 per year which isn't worth the effort of an additional account.

I'll use separate accounts to exploit switching bonuses, this is just for accounts I plan to hold permanently. 

We will each have an instant-access savings account that changes in line with whoever offers the best interest rate, and ensure we both have £500+ of annual interest to use our allowance. Similarly our cash-ISAs will move in line with best rate.

I might well use a money transfer card to accelerate the growth of a stoozing pot in addition to the above, once all the above is in place.

Thanks!

Nasqueron

which can later be switched to another 0% card

Don't assume this in your calculations, always have a plan to cover the purchases at the end of the deal, especially as the 0% is fixed i.e. any purchases in month 10 have 11 months, month 20 is 1 month etc

MrFrugalFever

All seems OK to me. Without knowing what your breakdown of monthly spends are its difficult to say if you're maximising your opportunities to earn more.

1% cashback can prove to be more lucrative than savings, even at the current rates of c. 5%APR. 

If you spend lets say £200 at the supermarket a month then a 1% cashback card giving £2 back is not likely to be setting records but if you spend say £600 at the supermarket then there are alternatives which could be more lucrative depending on which supermarket you're shopping at etc (including your fuel spend too).

Diversifying accounts is definitely a key thing, I do ALL of my online shopping using a credit card which is not linked in anyway to my main account which receives my salary. If something was to go wrong and my credit card be fraudulently used then well, that becomes the credit card companies problem and i'm still left with a fully functional bank account to access for my needs.

In fact, I do all of my spending on credit cards full stop - mainly Avios/Membership rewards points gained (which can be converted to Avios/Nectar points) whilst leaving my money in an instant access savings account earning c 4.54% +.

hugheskevi

Nasqueron said:

which can later be switched to another 0% card

Don't assume this in your calculations, always have a plan to cover the purchases at the end of the deal, especially as the 0% is fixed i.e. any purchases in month 10 have 11 months, month 20 is 1 month etc

Agreed - I've used 0% credit card borrowing for many years, and always cover the possibility of non-renewal by ensuring funds would be available if there were no cards to switch to, then release those earmarked funds for other things once the balance is transferred.

All seems OK to me. Without knowing what your breakdown of monthly spends are its difficult to say if you're maximising your opportunities to earn more.

Fairly unremarkable expenditure pattern - about £420 per month on household bills that would be eligible for Santander Edge cashback (ie Council Tax, water, electricity/gas, broadband, mobile phones), about £500 per month in supermarkets, and about £2,000 on other things (averaged across year). We have one old car for the household that isn't used for many miles (we live in London, and commute by bike), and don't have any children, mortgage or rent.

1% cashback can prove to be more lucrative than savings, even at the current rates of c. 5%APR. 

If you spend lets say £200 at the supermarket a month then a 1% cashback card giving £2 back is not likely to be setting records but if you spend say £600 at the supermarket then there are alternatives which could be more lucrative depending on which supermarket you're shopping at etc (including your fuel spend too).

This is something I wondered too - Tesco Clubcard Plus in particular could be advantageous, as could Sainsbury/Nectar-based cards.

I plan to get weekly Asda home delivery, with a monthly shop at Aldi/Lidl for durables. Looking at Asda's credit card it didn't give anything that I wouldn't get from Chase, and I would prefer to use the 0% purchases card over Chase.

Diversifying accounts is definitely a key thing, I do ALL of my online shopping using a credit card which is not linked in anyway to my main account which receives my salary. If something was to go wrong and my credit card be fraudulently used then well, that becomes the credit card companies problem and i'm still left with a fully functional bank account to access for my needs.

I have been doing the same, just using Chase accounts for expenditure-only whilst overseas and using Starling as my main account.

This proved to be very helpful when I had a serious issue with Turo (a USA company that uses an AirBnb-style model but for car hire). They were terrible and made error after error and failed to take the appropriate actions when I called them, eventually resulting in their systems trying to make unauthorised attempts to take money from my bank account for thousands of dollars that was not due. I only kept about £500 in the account (and regularly topped that up as it declined), so their withdrawal attempts failed, which was fortunate when the issue was eventually resolved it was easier than it would have been had they been able to take the money.

MrFrugalFever

If you have the Tesco clubcard app, you'll see that points can be converted in to various things such as gift card vouchers for Hotels.com etc. Tesco have recently reduced the benefit of this though (used to be able to triple up your points but now its double up), depending on your needs this could prove quite valuable. On the other hand, nectar points can be converted to Avios for money off holiday packages with British Airways or reduced flight fares (again depending on your needs), or points spent in Argos and Sainsburys.

You'd need to weigh up the cost in a like-for-like shop between the supermarkets as its all well and good having extra points with Tesco but if they're coming out as £30+ more expensive a month than say Aldi/Lidl with LFL goods then its just not worth it.

Stoozing (if done correctly) from credit cards is, at the moment, likely to give you the great returns due to interest rates still being C.4.5%APR and above on instant/easy access accounts. This obviously depends on limits, fees and terms imposed though but as you have no mortgage or rent you may find that you could afford the minimum payments from your regular income as opposed to withdrawing from the deposited funds.

TopCashback (and if your join BA Executive Club for Avios reward points) provide additional cashback or points bonuses to be converted. So far in the last year I have generated over £200 through TopCashback which has been all on my normal intended spend such as car insurance, travel insurance, pet products etc. I've been able to withdraw as a Bank Transfer (pretty quick too) or convert to additional Avios Points with TopCashBack.

hugheskevi

MrFrugalFever said:

If you have the Tesco clubcard app, you'll see that points can be converted in to various things such as gift card vouchers for Hotels.com etc. Tesco have recently reduced the benefit of this though (used to be able to triple up your points but now its double up), depending on your needs this could prove quite valuable. On the other hand, nectar points can be converted to Avios for money off holiday packages with British Airways or reduced flight fares (again depending on your needs), or points spent in Argos and Sainsburys.

TopCashback (and if your join BA Executive Club for Avios reward points) provide additional cashback or points bonuses to be converted. So far in the last year I have generated over £200 through TopCashback which has been all on my normal intended spend such as car insurance, travel insurance, pet products etc. I've been able to withdraw as a Bank Transfer (pretty quick too) or convert to additional Avios Points with TopCashBack.

I used to find Tesco Clubcard points very useful, able to triple their value and regularly spend them on things I would have spent on anyhow - usually entry charges, but often other things too. In more recent times though I have struggled to find much of value at times.

TopCashback (and if your join BA Executive Club for Avios reward points) provide additional cashback or points bonuses to be converted. So far in the last year I have generated over £200 through TopCashback which has been all on my normal intended spend such as car insurance, travel insurance, pet products etc. I've been able to withdraw as a Bank Transfer (pretty quick too) or convert to additional Avios Points with TopCashBack.

I always used to use Quidco, then got out of the habit of looking at cashback sites prior to purchase, aside from purchases of insurance. But I've signed up to Topcashback as well and will try to get back into good habits  

HeparGirl24

Be aware though you may not get a decent credit card straightaway - when I returned from living abroad, my credit file was not good enough for most credit cards. They didn't like I couldn't give 3 yrs of UK addresses and no recent UK income etc. I don't know your situation of course, but just returning with a decent lump sum from a house sale wasn't sufficient in my case.

hugheskevi

HeparGirl24 said:

Be aware though you may not get a decent credit card straightaway - when I returned from living abroad, my credit file was not good enough for most credit cards. They didn't like I couldn't give 3 yrs of UK addresses and no recent UK income etc. I don't know your situation of course, but just returning with a decent lump sum from a house sale wasn't sufficient in my case.

I've kept a very strong UK footprint, remaining on electoral roll and with active UK bank accounts and credit cards remaining at the address which I will be returning to throughout my time away, so I expect to be okay on that front. I've also had fairly regular payments from my employer as I have been on unpaid leave, so received PAYE income tax refunds from my employer during the first year away, then bonus payments from the previous year, and more recently pay again as I have returned to payroll and taken paid leave prior to starting back in person.

I might have a few issues with not having any debt at all for most of the time away though, as I repaid and closed many accounts prior to leaving. My wife will be fine as we used a Barclaycard Reward credit card for expenditure in Argentina over the last 4 months, but the only credit card in my name (Halifax Clarity) hasn't been used very much, so for most of the last 18 months I've had little or zero debt showing on credit reports unfortunately. Hopefully that won't be too much of an issue though.

ZeroSum

hugheskevi said:

Nasqueron said:

which can later be switched to another 0% card

Don't assume this in your calculations, always have a plan to cover the purchases at the end of the deal, especially as the 0% is fixed i.e. any purchases in month 10 have 11 months, month 20 is 1 month etc

Agreed - I've used 0% credit card borrowing for many years, and always cover the possibility of non-renewal by ensuring funds would be available if there were no cards to switch to, then release those earmarked funds for other things once the balance is transferred.

All seems OK to me. Without knowing what your breakdown of monthly spends are its difficult to say if you're maximising your opportunities to earn more.

Fairly unremarkable expenditure pattern - about £420 per month on household bills that would be eligible for Santander Edge cashback (ie Council Tax, water, electricity/gas, broadband, mobile phones), about £500 per month in supermarkets, and about £2,000 on other things (averaged across year). We have one old car for the household that isn't used for many miles (we live in London, and commute by bike), and don't have any children, mortgage or rent.

1% cashback can prove to be more lucrative than savings, even at the current rates of c. 5%APR. 

If you spend lets say £200 at the supermarket a month then a 1% cashback card giving £2 back is not likely to be setting records but if you spend say £600 at the supermarket then there are alternatives which could be more lucrative depending on which supermarket you're shopping at etc (including your fuel spend too).

This is something I wondered too - Tesco Clubcard Plus in particular could be advantageous, as could Sainsbury/Nectar-based cards.

I plan to get weekly Asda home delivery, with a monthly shop at Aldi/Lidl for durables. Looking at Asda's credit card it didn't give anything that I wouldn't get from Chase, and I would prefer to use the 0% purchases card over Chase.

Diversifying accounts is definitely a key thing, I do ALL of my online shopping using a credit card which is not linked in anyway to my main account which receives my salary. If something was to go wrong and my credit card be fraudulently used then well, that becomes the credit card companies problem and i'm still left with a fully functional bank account to access for my needs.

I have been doing the same, just using Chase accounts for expenditure-only whilst overseas and using Starling as my main account.

This proved to be very helpful when I had a serious issue with Turo (a USA company that uses an AirBnb-style model but for car hire). They were terrible and made error after error and failed to take the appropriate actions when I called them, eventually resulting in their systems trying to make unauthorised attempts to take money from my bank account for thousands of dollars that was not due. I only kept about £500 in the account (and regularly topped that up as it declined), so their withdrawal attempts failed, which was fortunate when the issue was eventually resolved it was easier than it would have been had they been able to take the money.

Tesco clubcard plus is a complete waste of time. You don't get any extra points bizarrely for shopping in tesco, but give you 1 point for every £8 spent elsewhere. And because of roundings, you get about 20x that from chase. I think they give you double points in tesco for the 1st 3 months when you sign up, which might be worth a bit if you do shop there a lot.

WillPS

MrFrugalFever said:

If you have the Tesco clubcard app, you'll see that points can be converted in to various things such as gift card vouchers for Hotels.com etc. Tesco have recently reduced the benefit of this though (used to be able to triple up your points but now its double up), depending on your needs this could prove quite valuable. On the other hand, nectar points can be converted to Avios for money off holiday packages with British Airways or reduced flight fares (again depending on your needs), or points spent in Argos and Sainsburys

Just a minor but important caveat - you cannot redeem for 'gift card vouchers', you can only redeem for vouchers which all have various stipulations associated to them which gift cards/gift vouchers do not.

With Hotels.com the major point is that the property must be paid for via a specific Hotels.com link (you cannot pay at property) and the voucher cannot be used for the 'tax' element of the transaction. You also lost out on Hotels.com/Expedia rewards.

Other redemptions block use of any promotions at all, so it is very rare, possibly impossible now, to get a genuine 'double' value. Attraction vouchers can typically only be used against full price tickets for example - given how freely half price vouchers are often available you effectively give up all the benefit of 'doubling up'.

I tend to aim for 180%ish face value by getting a voucher for the nearest amount possible on Hotels.com, minus the VAT. The missing 20 % points account for missing out on Hotels.com rewards and also because if I didn't use Clubcard vouchers I'd perhaps be able to get a slightly better rate elsewhere.