The Top Regular Savers Discussion Thread

huw01

https://forums.moneysavingexpert.com/discussion/comment/82072532#Comment_82072532

Yes I get what's being said but many people just look at the headline rate and disregard the term, how many people on here have said I don't bother if it's under X%, but that's on the assumption that most regular savers are for 12 months, but there are shorter term ones now 6 months for example that have a headline grabbing rate.

For regular savers the compounding comes from the term and not the rate. If you can fund one of the longer term ones don't automatically disregard it because it is under a certain rate.

friolento

https://forums.moneysavingexpert.com/discussion/comment/82070273#Comment_82070273

Last time I checked the T&Cs, they said you need the Club current account to open the Club RS. They didn't say you need to keep the Club current account. So it was possible to upgrade a normal current account to a Club, then open the Club R, and downgrade the Club current to a normal again. All in one online session. I know someone who has done this for 9 years in a row. Not sure whether it's still possible now as Lloyds seem to have tweaked their systems a little.

jaypers

It’s simple maths but understandable how people get confused by it. Stretching things a bit but if there was a regular saver for £100k over 12 months (£8,333 pm) at 2% is would generate about £1,000 in interest but nobody would do it!

friolento

https://forums.moneysavingexpert.com/discussion/comment/82072535#Comment_82072535

Regardless of the duration of an account, the fact remains that 7.1% is more than 5.4%. In other words, you make more interest for the same amount of money over the same period from the higher interest rate.

Section62

https://forums.moneysavingexpert.com/discussion/comment/82072535#Comment_82072535

For regular savers the compounding comes from the term and not the rate. If you can fund one of the longer term ones don't automatically disregard it because it is under a certain rate.

Compounding is only relevant if interest is paid into the account during the term. So a multi-year RS account would be better from a compounding point of view, but mainly by virtue of many one-year RS accounts only paying interest at the end of the term.

A common reason why people say "I don't bother if it's under X%" is because unless the RS has an interest rate sufficiently higher than the best easy access rate then the hassle of opening and running the RS account may not be worth it (in their own personal circumstances).

A multi-year RS account paying the same (or less) than the best easy access rate is only really worth having if there's a belief that interest rates may alter during the term which would make the RS account the more advantageous one.

clairec666

https://forums.moneysavingexpert.com/discussion/comment/82072558#Comment_82072558

A bit of an extreme example, but makes the point well 🙂

huw01

https://forums.moneysavingexpert.com/discussion/comment/82072563#Comment_82072563

I don't think this needed to be said, that's obvious. These are the sort of comments that make we want to leave these threads and not bother contributing

All I've said is don't disregard the rate alone look at it in along with the length of term

topyam

Lloyds

Have now got online banking. Can see my BoS account on there too.

Haven't funded either yet.

When I click into either account, I get an error message coming up at the top - anybody else?

clairec666

https://forums.moneysavingexpert.com/discussion/comment/82072574#Comment_82072574

Agree that rate alone isn't everything. But I wouldn't follow the rule of "longer = better" either, especially when there's such a big discrepancy in rates.

A lot depends on how much you've got available to deposit, too.

jaypers

https://forums.moneysavingexpert.com/discussion/comment/82072596#Comment_82072596

You’ve missed a vital piece of info, making your point a little misleading.

Zopa (1st RS, month 1-6) = £36 interest.

Zopa (2nd RS, month 7-12) = £36 interest.

So that’s £72 interest in the same period as £1800 into a 5.4% account over 12 months which gives you £49 or the same £300 pcm over 12 months (£3,600) at 5.4% would give you c£98 AND significantly more cash locked away.