Are regular savings accounts worth it ?
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ValiantSon wrote: »I'd suggest only worth bothering with once you've exhausted most of the regular saver and current account options.
To make the best use of it you'd need to withdraw the £50 as well, otherwise you will have an increasingly large sum sitting in it only earning 1%.
Agreed, only worth considering after other options are filled up.
I don't think you can withdraw the monthly £50 and still get the interest - it looks like the balance has to increase by £50 every month? That's how I read it anyway.0 -
I made that mistake last year, but this time around I am staggering re-opening them, so that one matures each month next year. Going forward, that method help cash flow during the year, and avoid the big blob of money suddenly needing a home.Joe_Bloggs wrote: »There does becomes a time when they mature and that you have bucket loads of cash to find a home for.0 -
Fingerbobs wrote: »Agreed, only worth considering after other options are filled up.
I don't think you can withdraw the monthly £50 and still get the interest - it looks like the balance has to increase by £50 every month? That's how I read it anyway.
Yes, but the way around this is to pay in £50, receive the interest, then withdraw the £50 (plus interest) and then pay it in again for the next month's interest. Repeat each month.0 -
This would not work. The condition is not to pay in £50 per month but to increase the balance by £50 per month (as measured on the second last business day of the month)ValiantSon wrote: »Yes, but the way around this is to pay in £50, receive the interest, then withdraw the £50 (plus interest) and then pay it in again for the next month's interest. Repeat each month.
It is however the only instant access account to pay 1.50% on balances up to £5,000 from day 1.0 -
This would not work. The condition is not to pay in £50 per month but to increase the balance by £50 per month (as measured on the second last business day of the month)
It is however the only instant access account to pay 1.50% on balances up to £5,000 from day 1.
It should do. If you pay the £50 in and receive the interest and then reduce the account balance by £50 plus interest then paying another £50 in would increase the balance again. Alternatively, you could leave the interest in the account and withdraw the original £50, and then pay it back in, thus definitely increasing the balance by £50, and then withdrawing it again after the interest is paid.
Of course, all this faffing around just emphasises my view that the account is not that great. I can get 1.5% (2% until July) on £5,00 with Club Lloyds and don't have mess around to do it! If all the current account options are filled, then really people should begin to think about investments anyway, as they are holding large sums of cash and, even in an account paying 1.5%, losing value due to inflation.0 -
ValiantSon wrote: »It should do. If you pay the £50 in and receive the interest and then reduce the account balance by £50 plus interest then paying another £50 in would increase the balance again. Alternatively, you could leave the interest in the account and withdraw the original £50, and then pay it back in, thus definitely increasing the balance by £50, and then withdrawing it again after the interest is paid.
Of course, all this faffing around just emphasises my view that the account is not that great. I can get 1.5% (2% until July) on £5,00 with Club Lloyds and don't have mess around to do it! If all the current account options are filled, then really people should begin to think about investments anyway, as they are holding large sums of cash and, even in an account paying 1.5%, losing value due to inflation.
Is it even worth worrying about "only" getting 1% on a mere £50 per month? If you're using this account, then there clearly isn't anywhere else you can stash your money that would pay any more than 1.5%, so you're only potentially "losing" about £1.50 per year on the £50 per month if you leave it in there, and that's assuming there is somewhere else you could have put that £50 per month that would pay 1.5% on it. It's negligible.0 -
The balance on the penultimate business day of the current month must be £50 greater than the equivalent balance for the previous month. You cannot take out £50 and then replace £50 and achieve this condition.
Try it on a spreadsheet and you will see.0 -
The balance on the penultimate business day of the current month must be £50 greater than the equivalent balance for the previous month. You cannot take out £50 and then replace £50 and achieve this condition.
Try it on a spreadsheet and you will see.
Okay, I get what you are saying. You could pay a larger amount each month and then withdraw that.
As to whether it is worth doing, there are plenty of other easy access savings accounts paying over 1%. As I've said already, however, with all the interest paying current accounts filled and regular savers subscribed to, there is a very strong argument to get money into investments rather than keeping even more cash that is losing value.0 -
That is the way to do it. You are then, essentially, recirculating the same lump sum.Fingerbobs wrote: »I made that mistake last year, but this time around I am staggering re-opening them, so that one matures each month next year. Going forward, that method help cash flow during the year, and avoid the big blob of money suddenly needing a home.0 -
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