Santander 123 still best savings account ?

hubb wrote: »

How do I change my 123 to a lite ? there is no way to do this. As Marcus state that the bank account given upon application is the only linked account allowed, that would mean changing to a lite with a different account number would deem it impossible to move money unless in my current 123 account.

You can ring Santander.

Someone posted earlier today that you can also do it online.

Your account number and sort code remain the same on the Lite.


The only complication for me was that my salary was not paid into Santander 123, so going forward anything I want to save from income has to be 'hopped' via Santander Lite to Marcus. A 2-minute job once a month.

trailingspouse wrote: »

No, I don't think my calculations are 'deeply flawed'.

I said your number crunching was 'deeply flawed'. You've started from the point that you have to 'cover' the £5 fee and then satisfied yourself that you have achieved this with cashback. That is a fundamental flaw, because you are conditioning the rest of your crunching on the false premise the £5 is justified and/or the best solution, without examining the other options.

Less flawed number crunching would discard the notion that the £5 fee was a given, and consider the alternative strategy of only paying a £1 fee to get the same value of cashback.

trailingspouse wrote: »

Marcus only pays 1.5% for a year, so if I went down that route I'd have to rethink it all in a year's time anyway.

True, but none of us know what accounts my come up with higher interest rates in the next 12 months, and returning back to having a Full 123 account (if necessary) should be as simple as making a few mouse clicks in a year's time.

trailingspouse wrote: »

And I'd have to pay £500 a month into the Santander Lite account (where it wouldn't be earning any interest)

You forget the golden rule of checking to see how long the monthly credit (if any) needs to remain in the account. Your loss of interest on £500 will not be great if it is only in the Lite account for 30 seconds.

trailingspouse wrote: »

...and keep a balance in that account sufficient to cover my direct debits.

This is a downside, but one which is manageable.

trailingspouse wrote: »

Seems a lot of bother when I'm already getting 1.5% and cashback.

This is where the deeply flawed number crunching can come back to bite you. You aren't getting 1.5% and cashback, unless you have over £5 of cashback (although you do, hubb doesn't for example). If not, your cashback is being swallowed up by the fee, and when that is all gone, the fee starts nibbling into your 1.5% - especially if your balance is only "north of £15,000 a lot of the time" rather than "always £20,000"

trailingspouse wrote: »

I just don't think the marginal gains are high enough.

Fair enough, but that is a judgement call based on your personal circumstances and expectations, rather than a result of "number crunching". The number crunching does the maths, you decide whether or not you like the number.

Personally, I love the sound of an extra £48 per year.

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 ?

WRONG

Their 'real' rate is 1.26% (assuming you have full £20k) & has never been the best savings account. If you only have £5k in, you're only getting about 0.5%

How many people have fallen for this con?

trailingspouse wrote: »

But it isn't an extra £48 a year, is it? It's £48 less whatever interest you would have got on the money you need to have sitting in Santander Lite to cover your direct debits. And whatever you end up paying out in overdraft fees if you get it even a tiny bit wrong.

If your DD's are for consistent amounts paid on consistent dates then (as I have) set up SO's to transfer money to the 123Lite account one or two days before the DD is due to be paid out. At most the loss is one or two days interest on the amount of the DD, plus maintaining a minimum balance (I work on £10 minimum for this kind of account, which exceeds the majority of my DD's anyway).

Zero risk of overdraft/unpaid charges, unless the bank sending the SO mucks up - in which case compensation would be due.

The average balance over the year will be something around £15. @1.5% = 22.5p

I stand corrected:-
"Personally, I love the sound of an extra £47.77 per year."