Bonus, Gross & AER - am I making the right decision here

taless

Hi,

Just like to confirm if my idea's correct.

I have a Halifax Current Account, so 2 savings account interest me due to the speediness of transfers - one is the Sainsbury's Internet Saver (5.75% Gross) and Halifax Web Saver with Cashcard (6.00% Gross until July, 4.75% Gross thereafter, 5.29% AER calculated on Feb 13).

In terms of earning the most interest, am I correct that if I keep my savings in the Halifax Web Saver with Cashcard until July, then transfer them there to Sainsbury's thereafter, I will be earning the most interest?

Thanks!

Meltdown_2

taless wrote: »

Hi, Just like to confirm if my idea's correct.

I have a Halifax Current Account, so 2 savings account interest me due to the speediness of transfers - one is the Sainsbury's Internet Saver (5.75% Gross) and Halifax Web Saver with Cashcard (6.00% Gross until July, 4.75% Gross thereafter, 5.29% AER calculated on Feb 13).

In terms of earning the most interest, am I correct that if I keep my savings in the Halifax Web Saver with Cashcard until July, then transfer them there to Sainsbury's thereafter, I will be earning the most interest?

Thanks!

In general (and limiting the options to the accounts you mention), yes.
But ...
The current account will be earning the most interest (6.17% APR) on amounts up to £2500 - so ensure you keep it topped up to that level.
The Halifax Web Saver with cashcard account is a variable rate, and this could go down soon, as the Sainsburys account has just done.

As you can open both the savings accounts online with little effort, I would do that first (both of them), putting a nominal sum in each. Then transfer amounts over £2500 from Halifax current to the Websaver - it is useful to have anyway for this siphoning-off of excess amounts.

Assuming no changes in relative rates between the 2 savings accounts before July, keep things that way till then. At that point transfer funds over from the Websaver account to the Sainsburys one.

If the rates change in a way that makes the Sainburys account a better home for your money before then, you will be able to make the transfer straight away.

However (and you probably are aware of this anyway), you could get more interest by increasing the range of accounts you are considering.