The Sunday Times Gets It Wrong

david78

This is the problem with a lot of people. They have the mentatility that you can only have one account - if your money is not in an account it must instead be tucked away under a mattress! ::)

I wondered why I was having trouble dropping off.


My philosophy is open as many accounts as you want to.

Paul_Varjak

If I can put in my few pence worth, Mr. Shilling!

I totally agree with what you say. I enquired about the Halifax account recently and the helpful lady at the Halifax agency told me something similar! My immediate thought was that she was not thinking about it in the right way.

Then, on BBC Two's Working Lunch, they were saying almost the same as the Sunday Times article and again I thought what total rubbish.

Of course, in practice, you may not be able to do automated transfers from a high interest account to the Halifax account and, maybe, Halifax requires you to do that. So, it may mean transerring money manually from a high interest account to a current current where transfer can be done automatically.

Also, what happens at the end of the fixed term if you forget to take your money out? Does it just earn a piffling rate of interest?

The theory is fine provided you can cope with the practicalities!

Tim_L

Cahoot savings gives a decent monthly rate (5.10% for new accounts ), and a current account also with a good monthly rate (4.35%). So a transfer from one to the other and thence out via a standing order to one or both of the new accounts is going to be a very effective way of running these 7% deal. Worth opening Cahoot accounts for if you don't already use them.

HOWEVER there is a BIG caveat. If you request a transfer from Cahoot savings to Cahoot current a/c that is not to take place on the same day (i.e. a future transfer), it is actioned as a BACs transfer taking 4 working days. If you are arranging a future transfer around a holiday to cover the payment (for example) you need to be careful to take this into account.

MarkyMarkD

Thank you, Robert, for pointing out the complete idiocy of these women (from Chase de Vere and in the ST) which has been mirrored by stupid posts elsewhere on the 'Net (though of course not on here!)

The other point everyone is ignoring is that many people can fund their £250 or £500 a month out of their income, in otherwise diverting funds they would otherwise have added to their lump sum savings account. If this is the case, then there is no need to move money from a high interest savings account to a current account and then onto the monthly savings account - it can just go out on payday to the monthly savings account, minimising lost interest.

lipidicman

My first post

The above is precisely what I do. 8)

Even better, I put 3k in an ISA on the first day of the tax year (after using up the previous tax years allowance). Opened a halifax regular saver the same day and pay in 250/month from my pay. In 1yrs time the halifax saver matures with (3k + interest) ready for my next ISA deposit. Solves the problem of what to do with it. 8)

On the subject of working out monthly/daily interest. Robert is absolutely correct. I have met accountants who struggle with this and do 7%/12. They should teach this in school when they teach stuff like 3^3=27. Schools should teach people how to look after their money.