Tesco Savings DDs

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  • eskbanker
    eskbanker Posts: 30,979 Forumite
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    Ken68 wrote: »
    Thanks Scarecrow...that explains why I was declined an additional Internet Saver a/c. last week.
    How/why do you believe a future change in permitted funding methods in six months' time affects an account application now?

    However, it's sometimes mentioned that there's a limit (unpublicised I think) of six Tesco savings accounts per person so could you perhaps have fallen foul of that?
  • philng
    philng Posts: 801 Forumite
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    Disappointing to hear but a number of accounts I am funding such as BOS are now only paying 2% interest & there is a possibility ordinary Instant Access acounts online will be paying close to that by April next year.
    Also although I don't fund Santander with TESCO DDs I would close the 123 account when my monthly saver finishes as the 1.5% may also be matched elsewhere by April with Santander unlikely to increase the 123 rate in line with Base Rate increases.
  • Ken68
    Ken68 Posts: 6,825 Forumite
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    eskbanker wrote: »
    How/why do you believe a future change in permitted funding methods in six months' time affects an account application now?

    However, it's sometimes mentioned that there's a limit (unpublicised I think) of six Tesco savings accounts per person so could you perhaps have fallen foul of that?


    Sorry got that wrong, wasn't declined, was asked to phone.
  • adindas
    adindas Posts: 6,813 Forumite
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    edited 19 October 2017 at 5:10PM
    Thanks to the OP for bringing this news.

    But while I appreciate this news, I will wait and see until at least another person non first timer confirm this before I start considering another alternative.

    But it is expected that it is going to happen at some times in the future.
  • glider3560
    glider3560 Posts: 4,115 Forumite
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    I've been doing some calculations:

    3x Bank of Scotland accounts at £5,000 each paying 2.00%
    1x Lloyds account at £5,000 paying 2.00%

    Assuming highest instant access at 1.25%, difference in interest is 0.75%, therefore £150 on all four accounts.

    If the only alternative is to create £1 charity payments, that will cost £96 per year, reducing the extra interest down to just £54. At that point, I'd say the effort is hardly worth it and will probably just bung the money directly into the 1.25% account or cycle through regular savers.

    It was fun whilst it lasted.
  • Mee
    Mee Posts: 1,441 Forumite
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    edited 19 October 2017 at 5:35PM
    Will wait to see what is in my new TIS paperwork when it arrives.

    Fortunately my Santander is no longer dependent on TIS DDs, but most of my other high interest c/a are... aghhhhhhhhhhhhhh
    Free thinker.:cool:
  • EachPenny
    EachPenny Posts: 12,239 Forumite
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    philng wrote: »
    Also although I don't fund Santander with TESCO DDs I would close the 123 account when my monthly saver finishes as the 1.5% may also be matched elsewhere by April with Santander unlikely to increase the 123 rate in line with Base Rate increases.

    Funding the 123 account with Tesco DD's would normally be unnecessary as most people would have enough cashback earning DD's to meet the requirements of a typical household's maximum number of 123 accounts (3).

    The 123's effective rate, taking into account the monthly fee (but not cashback) is around 1.2% which can easily be matched elsewhere. So it is only the access to the preferential RS account and the DD cashback that makes the 123 account attractive.

    With an end to 'free' Tesco DD's the value of DD's going through the 123 account becomes more significant - any which earn less than £1 cashback would offer greater value as a DD required to earn interest on another account (because setting up anything else for that purpose will cost at least £1). So that means Water or Council Tax bills of over £100 per month, Energy bills over £50 per month, or Telecoms bills over £33 per month.

    Leaving only the two largest cashback earning bills DD'd from a 123 Lite account may be the best solution for many.
    "In the future, everyone will be rich for 15 minutes"
  • Mee
    Mee Posts: 1,441 Forumite
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    edited 19 October 2017 at 5:43PM
    Some helpful points re: Santander and DDs and comparable interest rate...

    My Santander 123 DDs don't generate enough cashback to offset the monthly fee (due to may low water and council bills), though the interest more than does so. I've found it invalueable for the amount I can stash away (up up 20K) whilst retaining the easy access and payment options (DDs, SOs and FPs etc) which help me operate other high interest c/as.
    Free thinker.:cool:
  • EachPenny
    EachPenny Posts: 12,239 Forumite
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    Mee wrote: »
    My Santander 123 DDs don't generate enough cashback to offset the monthly fee (due to may low water and council bills)...

    Same here. My water bill currently generates 9p/mth cashback, so that will become a BoS DD instead.

    I'm also going to take another look at my energy supplies as my current supplier does a combined bill on a quarterly basis. Split supplies billed monthly could be worth £6 per quarter in DD 'savings' and I know I spend less than £100 per month on energy on average. Hopefully I'll get better energy prices too :)
    "In the future, everyone will be rich for 15 minutes"
  • karlie88
    karlie88 Posts: 9,114 Forumite
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    edited 19 October 2017 at 6:00PM
    glider3560 wrote: »
    I've been doing some calculations:

    3x Bank of Scotland accounts at £5,000 each paying 2.00%
    1x Lloyds account at £5,000 paying 2.00%

    Assuming highest instant access at 1.25%, difference in interest is 0.75%, therefore £150 on all four accounts.

    If the only alternative is to create £1 charity payments, that will cost £96 per year, reducing the extra interest down to just £54. At that point, I'd say the effort is hardly worth it and will probably just bung the money directly into the 1.25% account or cycle through regular savers.

    It was fun whilst it lasted.

    Don't forget the Halifax Reward account(s). :)

    I agree that it's extra effort, but I still think it's worth it (just about). There are a couple of websites that offer £1 DDs too:

    https://www.payaquid.co.uk
    https://www.littledebits.org

    The latter offers a small % charity donation. It looks like they're both using GoCardless, which charges 20p for a £1 DD to be set up by one the above websites.

    I guess someone else could join in on the fun (e.g. 50pDD.com) and charge 50p per DD - 20p would be taken by GoCardless, 20p could be for the creator and perhaps 10p to a charity (which could be donated every 3 months in one lump sum)...could be a nice little earner especially if a few thousand people registered.

    Having typed all that, is a 50p DD even possible with GoCardless?
    :grouphug: :D Official MSE canny forumite and HUKD VIP badge member :D :grouphug:
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