Savings account to pay regular bills
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SnowWhite52
Posts: 2 Newbie
I know interest rates are low, but what's the best savings account to pay money into monthly by standing order for annual bills such as car tax, insurance etc and unexpected bills such as a problem with the boiler, so that I can draw on it when I need to without penalties. Thanks
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Probably a high interest bank accountI’m a Senior Forum Ambassador and I support the Forum Team on the Pensions, Annuities & Retirement Planning, Loans
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Maybe high interest bank accounts, and maybe high interest Regular Savings accounts. Either use those with easy access, or time the saver to mature just before the annual bill is due. This is what regular savers are intended for, though many use them just for general saving.Eco Miser
Saving money for well over half a century0 -
You'll find links at the top of the page that may help you in your quest.
If you do decide to choose a high interest bank account then be careful to ensure that you meet the criteria needed to receive the interest as many of the accounts require you to have a suitable number of direct debits coming out of the account and a minimum amount being paid in each month.
If you do not meet those criteria then you could find that you receive no interest in that month.
The high interest bank accounts will also only pay interest upto a certain amount of money saved, so many people end up with multiples of these accounts to get the interest on bigger sums of money saved.0 -
Hi and thanks very much for your replies. Perhaps I should have given more info - I won't be paying direct debits from the account, and I won't be putting large amounts in, probably only £100 a month, and the money could come out at any time, depending on if and when something comes up, but I'll definitely look at the high interest bank account, although I suspect I'm unlikely to meet the criteria.0
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Maybe a TSB Plus current account - just cycle in/out the required £500 by FP from another account.0
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If you won't be paying direct debits from the account, your options on terms of current accounts are limited to the Nationwide FlexDirect (pays 5% on £2,500 for a year and 1% afterwards, so move the remaining money after the year.) It's a one time offer though, so you can't get it again if you've already had it; or the TSB Classic Plus (pays 3% on £1,500 with no set end date.)
The Nationwide has a minimum monthly pay in of £1,000 and the TSB £500, but you can achieve these by moving money in from elsewhere by faster payment and then straight back out again.
The majority of savings accounts won't allow money to be paid straight to an external current account, so you'll probably need to move the money out via a linked current account in your name and then send it onwards when a bill needs to be paid, or pay via the current account debit card.0 -
SnowWhite52 wrote: »Perhaps I should have given more info - I won't be paying direct debits from the account,SnowWhite52 wrote: »although I suspect I'm unlikely to meet the criteria.Eco Miser
Saving money for well over half a century0 -
Maybe high interest bank accounts, and maybe high interest Regular Savings accounts. Either use those with easy access, or time the saver to mature just before the annual bill is due. This is what regular savers are intended for, though many use them just for general saving.
But you can usually only make one withdrawal a year on Regular Savers penalty free, so you couldn't use that to pay monthly bills.0 -
But you can usually only make one withdrawal a year on Regular Savers penalty free, so you couldn't use that to pay monthly bills.
All depends on the regular saver in question. HSBC, First Direct and M&S don't allow any withdrawals. I agree, however, that generally a regular saver is unlikely to be suitable if the money is going to be accessed during a 12 month period. There are certain exceptions, such as Santander and Nationwide.0 -
ValiantSon wrote: »All depends on the regular saver in question. HSBC, First Direct and M&S don't allow any withdrawals. I agree, however, that generally a regular saver is unlikely to be suitable if the money is going to be accessed during a 12 month period. There are certain exceptions, such as Santander and Nationwide.
Yeah, but then it kind of defeats the point of regular saving if you're going to withdraw each month as you'll end up not really getting anything.0
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