I need assistance calculating a drip feed structure that optimises interest earned.

clairec666

Midas_Crotch said:

So if I undertand you correctly, you're suggesting I forego an easy access account altogether and simply max out the monthly contributions of the regular savers, pulling from the least paying one and reallocating to the highest once I've exhausted my initial sum? That makes sense.

Yup, you've got it 

You should still make use of the best available easy access account for the first 2-3 months, i.e. until the full £8000 has gone into the regular savers.

Welcome to the fun world of regular savers!

Midas_Crotch

clairec666 said:

Midas_Crotch said:

So if I undertand you correctly, you're suggesting I forego an easy access account altogether and simply max out the monthly contributions of the regular savers, pulling from the least paying one and reallocating to the highest once I've exhausted my initial sum? That makes sense.

Yup, you've got it 

You should still make use of the best available easy access account for the first 2-3 months, i.e. until the full £8000 has gone into the regular savers.

Welcome to the fun world of regular savers!

So still deposit the £8000 into an easy access but, again, simply max out the monthly contributions of the regular savers?

Apologies for being so dense! 

clairec666

Midas_Crotch said:

clairec666 said:

Midas_Crotch said:

So if I undertand you correctly, you're suggesting I forego an easy access account altogether and simply max out the monthly contributions of the regular savers, pulling from the least paying one and reallocating to the highest once I've exhausted my initial sum? That makes sense.

Yup, you've got it 

You should still make use of the best available easy access account for the first 2-3 months, i.e. until the full £8000 has gone into the regular savers.

Welcome to the fun world of regular savers!

So still deposit the £8000 into an easy access but, again, simply max out the monthly contributions of the regular savers?

Apologies for being so dense! 

Yes - no point in having the £8000 sitting in a current account earning 0% interest. Check out https://forums.moneysavingexpert.com/discussion/6534798/the-new-top-easy-access-savings-discussion-area. Even though the money won't be in there for long, you'll earn some interest on it, and anything is better than nothing. If you want to keep things simple, find an account with one of the banks or building societies you're opening a regular saver with, to save you from having yet another set of login details!

Bridlington1

Midas_Crotch said:

Bridlington1 said:

Midas_Crotch said:

Bridlington1 said:

Firstly am I correct in thinking RS1 is the Zopa Regular Saver Pot, RS2 is the Monmouthshire BS RS 8, or possibly AIB Regular Saver, and RS3 is the Skipton RS1? If so there are slightly higher rate regular savers that could be used instead of Skipton. See:

https://forums.moneysavingexpert.com/discussion/6576962/the-top-regular-savers-discussion-thread/p1

If you've a £8k lump sum I would max out the regular savers if I were you, if you run out of money you could empty lower paying regular savers to fund the higher paying ones where the Ts&Cs allow (all of the ones I've mentioned allow either penalty free withdrawals or early closure or both)..

Thank you for replying, Bridlington1.

Yes, you're correct: Zopa, Monmouthshire, and Skipton.

Thank you for posting that link. I believe I am only eligible for the Market Harborough Fixed Term Regular Saver, as the others available appear to necessitate either having, or opening, a current account with them (by switching) or by opening within branch, the former stipulation putting me off of the First Direct option, though I understand one can create a "donor" current account to mitigate the inconvenience of switching your main account.

Thank you again.

Principality at 7.5% doesn't require a current account with them, and the ones that do require you to have a current account with them don't require you to switch (in other words simply having the current account makes you eligible for the regular saver).

That being said if you can get some money out of them as part of a switching offer whilst you're at it I'd recommend doing so. FWIW I've never switched a main current account but still had many switching offers.

I now grasp what you're suggesting. 

And I misunderstood the First Direct offer, as they only require you to switch to receive the £175 welcome bonus.

How did you receive the welcome offers without switching, if you don't mind me asking?

I did switch current accounts, it's just I never used any of my main accounts, instead I switched donor accounts that I set up specifically for switching. Essentially open a spare current account (often easiest to open a second account with a bank you already use), set up a couple of direct debits if required and then switch it to whoever's offering a switching offer.

First Direct is an easy one to grab as it doesn't require you to switch any direct debits, you can just switch an account that has a couple of standing orders to one of your other accounts and get the money that way.

Also remember to check the likes of TopCashback, quidco etc before opening accounts as you can often get money for opening current accounts through them on top of the switching offer.

Midas_Crotch

clairec666 said:

Midas_Crotch said:

clairec666 said:

Midas_Crotch said:

So if I undertand you correctly, you're suggesting I forego an easy access account altogether and simply max out the monthly contributions of the regular savers, pulling from the least paying one and reallocating to the highest once I've exhausted my initial sum? That makes sense.

Yup, you've got it 

You should still make use of the best available easy access account for the first 2-3 months, i.e. until the full £8000 has gone into the regular savers.

Welcome to the fun world of regular savers!

So still deposit the £8000 into an easy access but, again, simply max out the monthly contributions of the regular savers?

Apologies for being so dense! 

Yes - no point in having the £8000 sitting in a current account earning 0% interest. Check out https://forums.moneysavingexpert.com/discussion/6534798/the-new-top-easy-access-savings-discussion-area. Even though the money won't be in there for long, you'll earn some interest on it, and anything is better than nothing. If you want to keep things simple, find an account with one of the banks or building societies you're opening a regular saver with, to save you from having yet another set of login details!

Gotcha! Thank you.

I've actually hit a snag, however! I set up an Atom easy access account, to now discover they only allow you to pay into current accounts! Have I been naive in thinking that I could simply create a standing order of sorts into the regular savings accounts. Of course, I can transfer the required amount, combined, each month into my current account and then desposit them each manually. Or is that how's it's done anyway? 

Midas_Crotch

Bridlington1 said:

Midas_Crotch said:

Bridlington1 said:

Midas_Crotch said:

Bridlington1 said:

Firstly am I correct in thinking RS1 is the Zopa Regular Saver Pot, RS2 is the Monmouthshire BS RS 8, or possibly AIB Regular Saver, and RS3 is the Skipton RS1? If so there are slightly higher rate regular savers that could be used instead of Skipton. See:

https://forums.moneysavingexpert.com/discussion/6576962/the-top-regular-savers-discussion-thread/p1

If you've a £8k lump sum I would max out the regular savers if I were you, if you run out of money you could empty lower paying regular savers to fund the higher paying ones where the Ts&Cs allow (all of the ones I've mentioned allow either penalty free withdrawals or early closure or both)..

Thank you for replying, Bridlington1.

Yes, you're correct: Zopa, Monmouthshire, and Skipton.

Thank you for posting that link. I believe I am only eligible for the Market Harborough Fixed Term Regular Saver, as the others available appear to necessitate either having, or opening, a current account with them (by switching) or by opening within branch, the former stipulation putting me off of the First Direct option, though I understand one can create a "donor" current account to mitigate the inconvenience of switching your main account.

Thank you again.

Principality at 7.5% doesn't require a current account with them, and the ones that do require you to have a current account with them don't require you to switch (in other words simply having the current account makes you eligible for the regular saver).

That being said if you can get some money out of them as part of a switching offer whilst you're at it I'd recommend doing so. FWIW I've never switched a main current account but still had many switching offers.

I now grasp what you're suggesting. 

And I misunderstood the First Direct offer, as they only require you to switch to receive the £175 welcome bonus.

How did you receive the welcome offers without switching, if you don't mind me asking?

I did switch current accounts, it's just I never used any of my main accounts, instead I switched donor accounts that I set up specifically for switching. Essentially open a spare current account (often easiest to open a second account with a bank you already use), set up a couple of direct debits if required and then switch it to whoever's offering a switching offer.

First Direct is an easy one to grab as it doesn't require you to switch any direct debits, you can just switch an account that has a couple of standing orders to one of your other accounts and get the money that way.

Also remember to check the likes of TopCashback, quidco etc before opening accounts as you can often get money for opening current accounts through them on top of the switching offer.

This is really useful information! Thank you so much for taking the time to talk me through it. I very much appreciate it.

Bobblehat

Midas_Crotch said:

clairec666 said:

Cooperative regular saver at 7% requires you to have a current account, but there's no need to actually use it. It also allows unlimited access to your money. You could also open First Direct at 7%, but your money is locked in for a year. Could be useful if you don't need to access your money. There's also Nationwide at 6.5%.

You could easily open enough regular savers to deposit £3000+ per month, but it depends if you want the hassle of having several accounts with several different banks!

Back to your original question... I would recommend maxing out as many regular savers as you can, until you have deposited your original £8000 lump sum. Find the highest paying easy access account to put the rest of the money in. After your £8000 has been eaten up, and if you haven't got any extra money to put in, you can withdraw from the Monmouthshire account each month to keep feeding the higher-paying Zopa account. The Skipton RS doesn't allow withdrawals, but you could close the account to access the funds (with no loss of interest).

So if I undertand you correctly, you're suggesting I forego an easy access account altogether and simply max out the monthly contributions of the regular savers, pulling from the least paying one and reallocating to the highest once I've exhausted my initial sum? That makes sense.

With regard to First Direct, it seems I misread their conditions, because they only require you to switch to receive the £175 welcome bonus.

Again, thank you for your input.

Well you could forego the easy access account if you found enough RS's (paying more that the best EA you fancy) to dump all £8000 into them in the first month! You'd probably need ~25! They would have to be ones with no minimum monthly pay in, too!

For the sake of sanity, I suggest only the very experienced of MSE'ers or the brave try this strategy 

On the other hand, you can see there might be a sweet spot for you that does involve drip feeding out of an EA into a lower number of RS's (lower than ~25 anyway!). Have you tried doing some "what ifs" with 4 or 5 RS's, or substituting Skipton with another that negates having to close Skipton (mentioned by Clairec666) just before month 9?