Do you change accounts regularly for better rates?

phil7445

When I got made redundant last year I read on one of Martin's articles that the best place to put savings was the Sainsburys account. Since then the best accounts have been Bradford and Bingley and ICICI HiSave.

Do you shift you money around and close accounts when they are not the best buy? I have just closed my Bradford and Bingley account and will shortly close my Sainsburys account. All my savings are now with ICICI* (minus £3000 which is in the NS&I ISA which was (is?) the best buy at the time.

(*Yes it is less than £35,000 before anyone suggests that!)

Just wondered your thoughts.

Aegis

Switch around too much and you start losing significant amounts of interest. You can work out if it's worth switching using a Greedy algorithm (technical term for work out what will happen if you do certain actions) to see the net result of having switched in, say, 6 months time or a year's time. That way you'll be able to see if it's worth the lost interest.

For large interest rate differences, it's definitely worth switching, but when the difference is minuscule or likely to fluctuate anyway, it's probably not worth the hassle.

Primrose

Have switched around a fair bit in the past. Now opt mostly for One Year Bonds at the best rate available when the bonds mature. Don't think it's worth switching regularly if you only have a couple of thousand pounds in savings as you inevitably lose some of the benefit while you're in the process of switching. This is where I think Icesave have now cleverly cornered a share of the savings market they've snatched from ING with their simple "No catch" offers, no temporary bonuses to confuse savers about rates and a guarantee that you know your interest rates won't fall below a certain target. If you don't want to be spending half your life checking the internet for changed rates you can stick your savings there and know you're getting a consistently good deal.

McSaver

I have swicthed once from ING Direct to Icesave at the end of 2006 when ING Direct were reluctant to raise rates a couple of times. I havent needed to switch since. Did take out an NS&I ISA though before Icesave launched their own ISA.

rarrarrar

Have switched frequently over the last 2/3 years, you need to do the sums to work out if it is worth the hassle and how much interest you loose while the money is in transit.
The other hassle is keeping records for the tax return.

But at present most of my money has been going into 1 year fixed rate accounts.