Regular Savings Accounts Article Discussion

apt

If you care to read the leaflets about this account in the B&B branches you will realise that the conditions have changed form the initial version on the web. It's an interest rate penalty for one month if you make a withrawal or do not deposit £20. If you deposit more than £250 in any single month you will only get 0.1% for the rest of the term. This has already been pointed out on another thread when someone had the same idea.

Super_Consumer

:exclamati BEWARE If you go for the Saffron BS's high interesty Regular Savers Account!
We did this last week having read about it on this site but were horrified when Saffron sent us an open e-mail with the e-mail addresses of loads of others who had also signed up announcing we had opened the account.

Not only does this break to Data Protection Act but also leaves us wide open to the "Fishing Fraudsters" who can hide behind any Saffron communications in order to try and cheat us out of our cash.

Not only did Saffron do this once but they repeated the contravension of the Act when they sent us a second e-mail "withdrawing" the original one. We were not told to destroy the e-mail and that it would be illegal to use the information (addresses) it contained and we have recieved no explanation or appology.

The also got my details wrong showing further incompetence and yet another breach of the Data Protection Act.

This was obviously nothing to do with MoneySavingExpert.com but total incompetence by an organisation who should be thankful to them for the extra business they have had but instead they have abused the trust put in them.

Perhaps Safforn will have the decency to apoologise to both Moneysaving expert.com and all its readers for its massive massive !!!!-up?

So they may offer high interest rates but at what cost? Do you really want to put your money in their incompetent hands in the hope you might make a few extra pounds?

RayWolfe

So they made a mistake*. Tell them, not us.

*You ever done one of those? Probably not.

Blink_Eden

Edit: re-read the article and the first line does say "An alternative, online account is available for those with a First Direct 1st account" - but still think it is worth pointing out to those who speed-read "the blurb" before getting to the body of the deal.

Guys,

Just noticed the First Direct Cash ISA regular saver on the main site, went and had a look, and saw this in the FAQ section

http://www.firstdirect.com/savings/regular-saver-isa-faqs.shtml

anything else I need to know?

For at least the first 12 months, you must hold a first direct 1st Account from which to make your monthly payments.
Within the first 12 months, the monthly Banking Fee of £10 on our 1st Account will not be waived as a result of you having a Regular Saver ISA. Thereafter, for any month in which you hold the account, you will not have to pay the Banking Fee. The fee will, of course, be waived during the first 12 months if you meet any of the other Banking Fee waiver criteria.

Am I reading this right and that they will charge you £120 (over the year) for an account that you must have to get this one?

Even if you save the £300 a month, using Martin's own guidance you will only get (on average) 7% on £1800, which is £126 interest. So ineffect you are only getting £6 for the year.

Not sure what other benefits you get with the 1st Account, but surprised I didn't see this mentioned on the main site.

Have I missed something?

mary

Open an Esaver account, stick in a tenner and leave it there. That will count as another account and you won't have to pay the £10 p.m. into the First Account each month. It was confirmed to me yesterday when I was enquiring about the ISA.

KTF

mary wrote: »

Open an Esaver account, stick in a tenner and leave it there. That will count as another account and you won't have to pay the £10 p.m. into the First Account each month. It was confirmed to me yesterday when I was enquiring about the ISA.

Not any more. To avoid the £10 monthly charge you have to do one of the following:

Banking with first direct usually costs £10 a month, but it's free when you pay in at least £1,500 to your 1st Account each month, or maintain an average monthly 1st Account balance of £1,500 or hold a first direct mortgage (or a selected additional first direct product if your account was opened before 2 February 2009).

From: http://www.firstdirect.com/1st-account/overview.shtml

mary

That observation I did write a while ago and obviously things do change at times. Having said that I now have a Regular Saver ISA with them (i.e. a monthly one). I started in April 09. I simply feed in £300 p.m. into the First Account prior to the SO going out and I've got precisely £21 sitting in there keeping it alive otherwise and up to now I have not been charged £10 p.m. for not paying in £1,500. The current Ts and Cs may well say
what you quoted, but my experience seems to be different so far and that
is what I had been told by them when I queried it before I opened the ISA (queried it only verbally). So don't go by my experience, I'm just saying what is currently happening to me.

I-LOV-MONEY

Okay, this has probably been mentioned before, but just in case ...

If you put say £100 in an Regular Savings account at 5% pa, on month 1 you will be entitled to 5% on that £100. Month 2 you will put in a new £100 and you will get 5% on the new £100 for only 11 months. Month 3 the new £100 will only get 5% for 10 months.

By month 12 the £100 will get 5% for one month which is 0.416%

Would it not be better if you have £1200 to invest to put it in a lump sum one year investment account ?

Paul_Herring

I-LOV-MONEY wrote:

Would it not be better if you have £1200 to invest to put it in a lump sum one year investment account ?

Yes. If
1) You actually had a £1200 lump sum [1] and
2) Your 'investment account'[2] had a rate for the term that was better than the terms of the RS[3].

[1] rather than drip feeding it from salary/other income
[2] I'm assuming you in fact mean a savings based product rather than an equity based one
[3] I make it 2.7% gross/AER required to beat a 5% gross RS - willing to be corrected however.

KTF

The 'advantage' of a Regular Saver is that you are also earning interest on the funds that are in the feeder account but with rates at the moment there is not a lot in it.

Using the calculator here: http://www.moneysavingexpert.com/savings/best-regular-savings-accounts#calculator

12 x £100 in a regular saver at 5% will earn £32.26 in interest before tax.

If the £1200 was put in an Instant Access account (2.75%) and fed into the 5% regular saver at £100 a month the total interest earned (before tax) is £47 (£15 from the instant access and £32 from the regular saver).

If the £1200 was put in a 1 year fixed rate bond @ 4.27% then you would earn £51.24 in interest.

Of course the figures change if you were to put in the max £250 a month instead.