Currently stashing 1,000 a month away in 4.75% Sainsbury Bank Account, put wondering if instead I should be doing 4 x 250 a month in various regular savings accounts ranging in AER of 7~10%. I pay tax tax at 40%. How many of these regular saving accounts make you have a current account as well. I've already got a Bank Account with Abbey and a Premier Account with A&L, so no issues there. Looking at Halifax and Ipswich Building Society.
Thoughts anyone?
I presume you've already maxxed out your ISA allowance?
Yes, that was used on by the 9th April....
Those usually have a maximum amount and time limits etc etc and dont really seem worth the trouble when you calculate how much extra cash you actually end up with.
Then have you given serious thought to Pensions / VCT's etc ? Or are you going to need the cash sometime soon.
Try not to end up with more than 33k in any one place.
Don't be fooled by the high AERs associated with "regular saver" accounts, they are artificial, and *totally misleading*, a consequence of the contractual balance profile.
A different savings account which would pay you exactly same amount of interest if you made exactly the same regular payments, but which is not marketed as "regular" and therefore doesn't have the same contractual profile, would have to advertise a much lower AER.
Yes, but presumably you already have the cash in an ordinary savings account, earning around 5% or whatever the best you can achieve nowadays. Simply transfer the contractual amount each month from that account into one paying 7% and you're still a winner at the end of the year than if you'd left it all in the one paying 5%.
It's not like saying "I have 3,000 under my mattress, what's better, sticking it in a 5% ordinary savings account or drip feeding it into my 7% account at 250 a month."
Marcus
Halifax and Abbey don't require you to have a current account. The Halifax one automatically starts again after one year which is quite convenient, although they do transfer the money out into a really low interest savings account, so make sure you move it from there straight away.
Another one to look at is Scarborough BS, only pays 6% but 6 > 4.75.
Don't A&L have one that pays 10%?
Gareth.
Not to mention reverting to a piddly interest rate at the end of the term.
I agree.
tim
In message , Gareth writes
You should be able to choose where it goes with Halifax, mine goes into a web saver account at the end of the year.
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