Santander 123 still best savings account ?

hubb wrote: »

I have been with Santander 123 savings account for 3 years and earned some decent interest. I have monthly outgoings and earn cashback from those payments on top of my normal interest. Their rate is 1.5% interest.

I see in the top here shows Marcus as the best option, also with 1.5% BUT they don't seem to offer cashback on payments made. Am I missing something of is the Santander 123 still the best offer at the moment ?

Convert your 123 account to a 123Lite (so you still get the cashback) which reduces the monthly fee from £5 down to £1, then put the money from your 123 account into Marcus at 1.5%.

You will be £4 x 12 = £48 per year better off (Roughly, and terms and conditions apply )

hubb wrote: »

I don't understand what you mean, what would be the point of that when I could just move all my money now into Marcus now ?

An assumption has been made that you were getting a reasonable amount of DD cashback each month to offset the £5 per month fee.

If you weren't, then there were almost certainly better options over the last 3 years than Santander 123.

hubb wrote: »

I don't understand what you mean, what would be the point of that when I could just move all my money now into Marcus now ?

Ok, try this....

Put the money from your 123 account into Marcus at 1.5%. And convert your 123 account to a 123Lite (so you still get the cashback) which reduces the monthly fee from £5 down to £1.

You will be £4 x 12 = £48 per year better off (Roughly, and terms and conditions apply )

I assumed from your first post that the monthly cashback you get might be more than £1, but if not, other options might be more appropriate. (e.g. depending whether you want ongoing access to the Santander RS account)

Ok... here's the deal people are telling you about....

The suggestion is that firstly you move the bulk of your cash from 123 to marcus. It will earn 1.5%. Same as 123 except that there's no monthly fee to pay. This is good.

Secondly, you keep your account with santander but convert it to 123 Lite. This earns no interest - but no matter you're getting that in Marcus - but it DOES earn cashback - which marcus doesn't. And the fee is lower than original 123 . This is good too.

So you get your interest, you get your cashback and you pay a lower fee.

BUT you have two accounts where you previously had one and you'll have to manage the 123 Lite to make sure it has enough for your DDs each month (as most of your cash will be in Marcus).

trailingspouse wrote: »

I've crunched a few numbers trying to answer this question for myself. We currently have a full-fat Santander 123 account, and more than cover the £5 fee with our cashback. We also regularly have a balance north of £15,000 a lot of the time, which many other accounts can't cope with. So for a decent interest rate and a general lack of faffing on, I still think my money is in the right place.

You could move most of that 15k to marcus, switch the 123 to 123 Lite and be about £48 better off each year. The only faff is if you keep the 123 lite balance so low it becomes a problem for outgoings.