Complex ways to earn more interest

yahaa · 8 December 2019 at 9:13PM

The MSE weekly email often provides ideas for what I would think of as "complex" ways of increasing terms on savings accounts - ie methods that don't just involve switching to another account, but using an account in a different way to how it was intended. I'm talking about, for example:
- Drip-feeding a lump sum into regular saver accounts
- Using a current account as a savings account
- Stoozing

When I was young and didn't have 4 kids to keep on top of, I was happy to try every trick in the book to make my £s go a bit futher. But lately I've struggled to want to implement some of MSE's more "creative" recommendations, because of:
- More to go wrong

- Having to keep track of it all
- Having to remember lots of different online banking logins
- Concern that whether my wife would ever make head nor tail of any of this if I got run over by a bus..

To give a small example, I currently have a TSB current account sitting unused, that earns 3% interest on upto £1500 if I were to have my salary paid into it, whereas I have savings earning a lot less than this. BUT, I don't want to change bank accounts - I use Monzo, and the budgeting features of their app are too valuable for me to loose. I could have my salary go into TSB and then move the money out again with a standing order into Monzo. But it means if my pay were ever to be wrong/missed, I'd have to manually intervene to stop the TSB account going overdrawn. Or I could have money moving in and out of another current account to meet the requirements, but again it's just one more thing to keep an eye on, and more to go wrong if I'm relying to two different banks for my day-to-day expenditure. And it would all be very complicated should anything happen to me and my wife / executors have to make head nor tail of all this.

Which leads me to wonder - how complex is too complex? Does anyone have any thoughts as to how to weigh up the various pros and cons?

Thank you.

Murmansk · 8 December 2019 at 9:23PM

Well I don't know how much money you have but I can't imagine the extra you'll make by doing all this fancy stuff is all that much? Is it worth the effort?

I mean, how long does it take you to earn that much? Maybe just have an easier time, keep it simple and put a few more quid in from your earnings. The end result will be you'll have the same amount of money but with less hassle.

Neil_Jones · 8 December 2019 at 10:31PM

It can be as simple or as complicated as you like. You get out what you put in, and take advantage of the special offers like the "get £100 if you switch to Bank R US" incentives, the 5% on £2,500 type accounts and if applicable cashback through accounts like 123 Lite. Of course if you're happy with 123 Lite and the top easy access saving which is 1.45% @ Marcus, do it that way. If you're happy and able to feed regular saver accounts £250 a month to make £45 at the end of the term, do it. If not, then don't.

With regards to the executors, I dare say whatever you come up with won't be too complicated to track down as a request similar to ""my lost account" will dig them all up anyway. There are probably no end of stories of eccentric uncles who have died and when the house was cleared, found to have a few thousand pounds stuffed under the mattress that nobody knew about.. See TV shows like Heir Hunters.

Zero_Sum · 8 December 2019 at 10:47PM

I have accounts with about 20 different establishments using various creative methods on the cashback front. Keep track of it all using MS money

YorkshireBoy · 8 December 2019 at 11:00PM

Unless you've a lot of cash you'd have made more from switching incentives over the last two years or so than you would in savings interest.

With two of you I'd have expected approaching £2K.

And that's doing them in series, ie running just one extra account each at all times, not in parallel like those with more time would do to make the same cash faster.

But you've got to want to make money, ie put the effort in, to make money.

I'm guessing you've already enjoyed £7.5K at 5% for a year with Nationwide, otherwise why would you settle for only 3% on a smaller amount with TSB?

yahaa · 9 December 2019 at 8:34AM

Hi,

Yes we've already exhausted the Nationwide 5% deal. Plus we've had the TSB accounts for years, and the original purpose for them has passed now and I've not found a new use for them yet.

Switching bonuses we've not done many of, mainly because we like Monzo for its various budgeting features, and ultimately it's more important that we're confident where we are with our finances than getting the best deal every time. So most of them we're not really eligible for because we wouldn't be moving our 'main' account.

Some other banks are starting to copy some of Monzo's features though, so will keep an eye on this.

Thank you

colsten · 9 December 2019 at 9:12AM

yahaa wrote: »

Plus we've had the TSB accounts for years, and the original purpose for them has passed now and I've not found a new use for them yet.

Strange thing to say when they are the only current accounts left that would pay you a decent amount of interest, especially since these can be set up to bounce the monthly min payment between them, with next to no effort required to manage them. Never mind. TSB will pull them in a few months time, anyway, and you have made a conscious decision that you want to lose out.

yahaa wrote: »

Switching bonuses we've not done many of, mainly because we like Monzo for its various budgeting features, and ultimately it's more important that we're confident where we are with our finances than getting the best deal every time. So most of them we're not really eligible for because we wouldn't be moving our 'main' account.

Literally all people who switch for the bonus don't switch their 'main' account but have one or more donor accounts which they use for that purpose. Note there is no definition of what a 'main' account is - it's whatever you declare it to be. It appears you have missed out on major amounts of money as the remaining switch offers aren't too exciting now. Again, though, it's fine, as you have made a conscious decision you didn't want to be part of the switching frenzies that some of us MSEers can't but get excited about. Each to their own.

vacheron · 9 December 2019 at 9:25AM

I think my situation is too complex at the moment.

Things generally run themselves through direct debits and standing orders etc. but as you say, in the "run over by a bus" scenario", it would be very difficult for someone to unpick where everything is going (and why).

The main risk I face is that my credit cards payments come from a number of different bank accounts, so if there is a larger than usual credit card bill on one card coming up, I need to remember to send the extra money into the account that DD will be taken from.

Move the money in too early and I am losing savings interest, too late (or forget) and run the risk of late payment charges and a potential hit to the credit file.

I manage everything through a spreadsheet which I keep on dropbox so I can access and update it from all my devices including my mobile and home and work PC's. Passwords / logons are stored on an encrypted database on dropbox so I can add new account details straight away when registering before I forget them!

I keep intending to simplify matters, but each time I do, anonther £150+ bank switching incentive or juicy 0% CC offer comes my way and I can't resist it! :rotfl:

Zanderman · 9 December 2019 at 10:01AM

yahaa wrote: »

....
To give a small example, I currently have a TSB current account sitting unused, that earns 3% interest on upto £1500 if I were to have my salary paid into it, whereas I have savings earning a lot less than this. BUT, I don't want to change bank accounts - I use Monzo, and the budgeting features of their app are too valuable for me to loose. I could have my salary go into TSB and then move the money out again with a standing order into Monzo. But it means if my pay were ever to be wrong/missed, I'd have to manually intervene to stop the TSB account going overdrawn. Or I could have money moving in and out of another current account to meet the requirements, but again it's just one more thing to keep an eye on, and more to go wrong if I'm relying to two different banks for my day-to-day expenditure. And it would all be very complicated should anything happen to me and my wife / executors have to make head nor tail of all this....

As others have said it's up to you how complicated you make it.

You don't need your salary going to TSB to trigger the 3%, you just need 500 going in each month. You can automate that, taking it out again too (obviously) but if you're worried something might go wrong with automation then just do it manually. Login to another account, with TSB set up as a payee, move 500 to TSB. Than, 10 minutes later, login to TSB and move it back. Easy, and you know it hasn't gone wrong as you did it manually.

Re liking Monzo and not wanting to switch. Don't switch Monzo. Ignore all that stuff banks say about a switching bonus only payable for your 'main' account. There's no definition of 'main' account so you can switch any current account, even one you only opened for switching.

It's only as complicated as you want to make it.

MaxiRobriguez · 9 December 2019 at 10:07AM

If you've got multiple DD's/SO's across multiple bank accounts, just create a spreadsheet with days of the month on the vertical, bank accounts on the horizontal, and in the cells just a note of what is being transferred to/from each of the bank accounts.

Easy to see all the transactions you're doing on a page then.

Eco_Miser · 9 December 2019 at 2:48PM

I keep passwords, and usernames, and urls, and other info I might need about each bank, safely encrypted by a program called Password Safe, in a file kept alongside the spreadsheets that keep track of where the money moves to keep earning the interest, waive the fee, etc. primarily on an SD card that came with my first digital camera, but is way too small for photos, with other copies in safe places.

I've never paid my salary into TSB, but they keep paying me 3% on £3000.

OTOH, I reckon most of the current crop of regular savers are no long worth the effort for the additional interest over a Marcus 1.5% (no longer available) account.

Complex ways to earn more interest

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