Halifax to relaunch regular saver @10%+

Gambit

ih8stress wrote: »

Any advice on the SO's, anyone?....
Also the clock is ticking before I need to get it sorted for my appointment with the Halifax tomorrow morning.

I set up a regular saver on Friday after work and this is how I understand it works. The month (in terms of the regular saver) runs from the 29th to the 28th of the month. So I havent paid in anything for the period up to the 28th July yet as I have 14 days from when the account is opened but will be doing this sometime this week. I've been told I have to go into the branch to set up this first payment but after that the SO that I have set up from my Halifax current account will kick in. This was set up on Friday and I have arranged for the £500 to go in on the 18th of the month starting on 18th August (my second payment). I chose this date as its after pay day but before the 28th cut off.

ih8stress wrote: »

Would it be possible to set up a SO for £25 per month (say on the 5th of the month), and then go into the local branch to pay the cash balance of £475 before the 28th of that month?

If you can pay it in at the same time I would suggest that as although they should be able to accept more than one payment into the Regular saver every month (as long as it doesnt exceed the £500 limit) I have read of some users on here having problems with that. So I would set up the SO later on the month for the full £500 but this idea should work too if you want to go down this route.

sloughflint

If you are trying to maximise interest, the first payment should be as late as possible in the month ( but has to be before 20th July)and subsequent payments as early as possible in the month.

ih8stress

Gambit wrote: »

I set up a regular saver on Friday after work and this is how I understand it works. The month (in terms of the regular saver) runs from the 29th to the 28th of the month. So I havent paid in anything for the period up to the 28th July yet as I have 14 days from when the account is opened but will be doing this sometime this week.
.

Thanks for your advice. Don't forget that YOUR first payment must be by the 20th July - the closing date

HTH

ih8stress

Help! I've just set up the 10% RS account with the Halifax and have come back from their branch feeling totally confused.

When I told the advisor that the £500 a month I hoped to pay in would be from savings I already have she told me it would be a waste of time applying and that even if I 'drip-fed' this amount from an instant account paying around 6% interest, I would end up losing around £140 - £200 interest over the year. Is she right?

I had used the Savings Calculator to find out the different interest received.

First I calculated £500 per month for 1 year at 10%(non-taxpayer) and got an amount of £6,320.27

(If I held £6,000 for a year in a 6% account I would get £6,360, which would be £40 more interest than the Halifax RS)

I then calculated a sum of £6,000 to start with, for 1 month at 6% (non-taxpayer) and got an amount of £6,029.21. I then reduced the amount by £500 each time and added up the interest for each month. The total interest over a year came to £189.84.

So in theory, if I drip-fed £6,000 from an account paying 6%, I should get roughly £189 annual interest and if I paid £500 per month into the Halifax 10% I should get roughly £320 annual interest. This would mean a grand total of £509 for both of them. Is this the case, or I am barking up the wrong tree completely? I realise there would be some adjustments for SO's going out each month etc.

My second gripe is that I was told by the advisor that I can only make 12 payments (and not 13 as some have mentioned on this forum). She calculated my initial payment this week as the first one, the second in August - through to the twelf in June 09.
When I tried to point out that the account was over a year eg. July 2008 - July 2009 she just said that I could only make 12 payments, that the June payment would be the final one and that the interest would carry through until July 09. Again, was she right?

I'm not very good with figures, which is why I'd tried to gather as much information as possible beforehand.

She didn't try to sell me anything else after the initial 'waste of time' conversation. I decided to apply for the account anyway, knowing it was now or never. I knew I'd be able to get more friendly advice from this forum and that I could always alter my SO's to the minimum £25 per month if that was the best outcome for me.

Sorry this has been so long-winded. I have a limited internet access, so please bear with me.

Thanks

sloughflint

It IS worth applying,ih8stress.
6000*( 5.5*6+6.5*10)/1200=£490 gross.( drip feed method)

as opposed to £360 gross if you left it in a 6% paying account.

And stick to amounts/times that I suggested above to maximise interest.

F_T_Buyer

ih8stress wrote: »

Sorry this has been so long-winded. I have a limited internet access, so please bear with me.

I haven't gone through your calculations, but it sounds right. The regular saver will be better if the money yet to be transferred is already earning interest.

Also, you can get 13 payments in *if* you change the standing order to the start of the month after the first payment (assuming you open the account near the end of the month).

It seems the advisor couldn't figure these things out!

P.s. I have done 13 payments on previous Halifax regular savers, so I know it works!

debbie42

ih8stress wrote: »

When I told the advisor that the £500 a month I hoped to pay in would be from savings I already have she told me it would be a waste of time applying and that even if I 'drip-fed' this amount from an instant account paying around 6% interest, I would end up losing around £140 - £200 interest over the year.

That is completely ridiculous. How can you move your savings from an account paying 6% to one paying 10% and be worse off? Unless the payment is in limbo for weeks at a time., maybe? It beggars belief that a supposedly trained(?) advisor could try and suggest that.

ih8stress wrote: »

I'm not very good with figures

It sounds like you are better with them (and have more common sense!) than the advisor you saw.

Gambit

ih8stress wrote: »

(If I held £6,000 for a year in a 6% account I would get £6,360, which would be £40 more interest than the Halifax RS)

So in theory, if I drip-fed £6,000 from an account paying 6%, I should get roughly £189 annual interest and if I paid £500 per month into the Halifax 10% I should get roughly £320 annual interest. This would mean a grand total of £509 for both of them. Is this the case, or I am barking up the wrong tree completely? I realise there would be some adjustments for SO's going out each month etc.

I'm not brill at this either but I've looked into it and used a simple formula to work out the interest that you would be earning from the regualr saver:

Capital Amount x (Interest Rate/12 months of the year) / 100
So after the first month it would be £500 x (10/12) / 100 = £4.17

Using this simple formula I worked out that you should receive about £325 interest as you are not a tax payer.

Then for the normal 6% savings account using the same formula and drip feeding it out by £500 a month you should get £165 giving you a total of £490 interest.

If you just put it all into the 6% savings account and left it there for a year it would earn £360 as you said for for me the regular saver is obviously better. These are rough figures but are hopefully right as that's what I've been using to work things out. If I'm wrong I'm sure someone will correct me...

ih8stress wrote: »

When I told the advisor that the £500 a month I hoped to pay in would be from savings I already have she told me it would be a waste of time applying and that even if I 'drip-fed' this amount from an instant account paying around 6% interest, I would end up losing around £140 - £200 interest over the year. Is she right?

I think they say this in branch so they can convince you to pay into one of their other savings accounts. They see as the 10% rate to get people through the door and then take the opportunity to sell you its other products. Yep... I'm cynical of banks! :rotfl:

Gambit

sloughflint wrote: »

It IS worth applying,ih8stress.
6000*( 5.5*6+6.5*10)/1200=£490 gross.( drip feed method)

as opposed to £360 gross if you left it in a 6% paying account.

Woohoo... I was right! :T

Sorry to repeat your post but I started writing it before you posted...

nash0819

Going off on a different tack, I've just spend 40 minutes on the phone trying to get a simple answer out of Halifax about how I can get my nominated account moved from the default Web saver to the better-paying Guaranteed Saver. With all three accounts unfunded, I also wanted to know the order to do things - fund first or transfer the account first?

The first operator put me on hold for so long, I think the call defaulted to another operator. This guy was not the smartest tool in the box and kept repeating irrelevant and confusing information in response to my valid questions.

He told me they did not have enough information on record to verify my identity, despite going into a Halifax branch on Saturday with my ID's and them having a record of this. I imagined a Catch-22 situation of their records not having enough ID to verify me but me needing to prove my identity to get them to fix the problem.

Eventually, I wrangled it out of him that I have to deposit money into the Guaranteed Saver before I can make it my nominated account. This will apparently give them enough information to verify my identity!?!

He kept saying I had to "send instructions"; I knew he meant "instruct my bank to transfer funds to his bank" but it was a torture to get him to answer my questions to confirm this. It was not entirely clear whether I must fund my Regular Saver as well but I was losing the will to live by this point and gave up. [I'm assuming I do have to fund it]

Good job I have a fat inclusive minutes deal on my mobile and good job that I found the geographical Halfiax number to use instead of the 0845 number. My blood would be boiling if I'd paid through the nose for that call, most of which was spent on hold or talking to a simpleton.

First impressions of Halifax: 1/10
(the 1 point is for not dropping my call at any point and forcing me to restart the whole process!)