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New Abbey current account and linked Fixed Rate account
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Milarky
Posts: 6,356 Forumite


http://www.easier.com/view/News/Finance/article-28672.html
Both paying 6%pa. Fixed rate can recieve up to £250 of the £1000 minimum that must be deposited into the current account. It says this must be a 'main' current account but I think that just means £1000 to be credited [easily done with revolving payments]
Possible Scheme:
In Month 1:
Your Bank[1] --- £1250 --> Abbey 6pc c/a --- £250[2] ---> Abbey 6pc FRMS
Then during Months 2 - 12:
Your Bank[1] -- £1000 --> Abbey 6pc c/a --- £250[2] ---> Abbey 6pc FRMS
Your Bank[1] <-- £750 --- Abbey 6pc c/a
[1] Can just as easily be a savings account
[2] By 'same day standing order' I assume
Both paying 6%pa. Fixed rate can recieve up to £250 of the £1000 minimum that must be deposited into the current account. It says this must be a 'main' current account but I think that just means £1000 to be credited [easily done with revolving payments]
Possible Scheme:
In Month 1:
Your Bank[1] --- £1250 --> Abbey 6pc c/a --- £250[2] ---> Abbey 6pc FRMS
Then during Months 2 - 12:
Your Bank[1] -- £1000 --> Abbey 6pc c/a --- £250[2] ---> Abbey 6pc FRMS
Your Bank[1] <-- £750 --- Abbey 6pc c/a
[1] Can just as easily be a savings account
[2] By 'same day standing order' I assume
.....under construction.... COVID is a [discontinued] scam
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Comments
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Article in The Sunday Times today under the headline "Beware of catches on new Abbey current account".
According to the article, the account pays 2.5% AER with a 3.5% bonus after 12 months for balances up to£1,000. Overdraft rate is 16.9%, but you can opt for a lower overdraft rate of 9.9% but if you do after 12 months you in credit interest rate drops to 0.1%.
It is also a limited offer.0 -
Yes, agree that going over balances of £1000 on the Abbey current account - even for a few days as the money is turned around - is wasteful. There is no way around the need [under this suggestion of 'revolving' payments] to return the balance of the amount [of £250] needed for the FRMS and not used for other things [eg withdrawals at ATM, payments, other standing orders] whence it came. There are variations, but this one trys to maximize the in-credit balance on the c/a [first £1000 at 6pc] at all times. You could work this out on the assumption that:
Lost interest days: 4 [2 going and two coming back] @ 4.75pc - the 'ING rate', say.
Lower interest days: 0 on £750 returned [assuming money is 'returned' 2 working days after being sent and payments 'cross' and canel out
Lower interest days: 3.5 approx on £250 forwarded to FRMS. This is based on the fact that the SO amount always would go out on a fixed date, since it's between Abbey accounts, whereas a Monday departure date will vary in relation to this be up to a week.
So That comes out at about: !! 4.75pc x 4 days x £875[1] + [4.75 - 2.5]pc x 3.5days x £250 } divided by: !!365 pays x 100pc} times 12 months - about £6 gross interest.
Whereas £1000 x 6% = £60, and £1500 [av. balance on FRMS] x 6% = £90
If, instead of £150, the gross interest on £2500 av. balance is £144 instead that would equate to 5.76%.
[1] It's '875' because that's '1000' going and '750' back.....under construction.... COVID is a [discontinued] scam0 -
Hi,OP link article say "Abbey account must be your main current account" to get the rate you probably have to transfer DD / SO as a condition!0
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That can't be a condition - nobody has to have any DDs or SOs on their main account.0
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That can't be a condition - nobody has to have any DDs or SOs on their main account
Abbey have told us that you have to switch DDs/ SOs from what you currently consider to be your main account. Any DDs you have coming out of other cirrent accounts can remain untouched.
Having said that, there are still much better options than this account.Former MSE team member0 -
I understand that you only get the account if you let them do the switching.
1) But do you have to switch all DDs/SOs/Bill Payments? Or can you select some off the list?
2) Do they insist on closing the old current account for you?
3) I read somewhere it's for new customers only. Does that apply to savings account customers, too?Dagobert0 -
At last. A possible use for my duplicate A&L current account.
Back in August 2004 I applied for an upgrade to their Premier account but was given another identical current account. I've kept it on for just such a scenario as this.
At that time A&L were paying 5.35% on balances up to £25k so I had another reason not to get rid of it.Old Saying Once bitten twice shy
Modern Saying Once Sh*t on Twice Bye!0 -
Abbey have recently introduced a 6% Fixed Rate Monthly Saver account for existing current a/c holders, yet you cannot apply online - must be by post, phone or in branch. They are insisting people send in proof of ID - bank statements etc.
Surely this is a mistake ? If you have to have a current a/c to qualify why on earth do they need proof of ID ? I've banked with them 38 years... can I cynically suggest they are trying to put people off applying, merely making the offer to counter the 7% similar a/c available to new customers only ??am I missing something ??0 -
Rickycowslip wrote:They are insisting people send in proof of ID ... I've banked with them 38 years... can I cynically suggest they are trying to put people off applyingDagobert0
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Dagobert wrote:They are legally required to request proof of ID, even for existing customers......under construction.... COVID is a [discontinued] scam0
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