Getting the most from my money & savings account

[Nickbrapp]

for the first time in my life (22) i Am earning a good wage and in the position to be saving money every month.

I have just opened a TSB current account for the 5% interest on up too £2000, when paying in £500 a month.
one question i have on this, is once there's £2000 in there and i stop earning 5% can i just take the 2k out and then put it back in to gain another 5% or once the 2k is in does it continue to earn 5%? ( 5% over the year)


i plan to open a Help to buy ISA when they become available, and deposit the maximum £200 a month in to get the governments £50 ( payable when you buy a house) is this the best way to effectively save for a house? i cant see any other isas that will give anywhere near £50 interest on What is £2400 a year.

ive also been looking at switching to first direct current account to take advantage of their 6% locked in savers account for a year (max £300 a month) is it worth switching from natwest to them? whats their customer service like?

then i would save around £300 in a standard easy access account for every day treats etc.

in the mean time where can i save the £200 i will be putting into the help to buy isa once they come out or shall i just add it to my standard savings account?


if this isnt right whats the best way of saving around £1000 - £1400 a month? i still live at home so pay no rent, bills are around £250 a month. i have a company car. I earn between £1500 - £1900 a month depending on overtime and bonuses.

i put most of my daily spend on a amex cash back credit card that i pay off to earn a bit extra too.

is there anything else i can do, or should do? this is my first year of properly saving so i dont fancy stocks just yet. ( i have a spread betting client manger in the family when the time comes)


edit - company pension is the crap work place one, pay in 3% they pay in 3% and thats extreamly long term and im looking alot more short term, 1st house, then a BTL. and dont plan to stay in the uk forever

Edited by Nickbrapp on Sunday 5th April 17:53

[blank]

Company pension?

Usually a no brainer if the company make a half decent contribution.

[markwm]

The TSB thing reads like you only get 5% interest on the 2k if you continue to put in 500 a month. Obviously the 2k still needs to be in there to make interest

Very odd set up, doesn't mention if you need to keep the 500 quids in.

[Nickbrapp]

markwm said:

The TSB thing reads like you only get 5% interest on the 2k if you continue to put in 500 a month. Obviously the 2k still needs to be in there to make interest

Very odd set up, doesn't mention if you need to keep the 500 quids in.

it is a current account so not sure how it works, i plan to leave in £1500 and just move £500 in and out every month.

[Flip Martian]

I would read it as "5% on any amount up to 2k" - so really, just keep in there whatever amount you want to earn 5% on. If you take all the money out at any time, you won't be earning anything - and if you have a balance of 2.5k (say) you only earn interest on the first 2k - so the other 500 earns nothing.

[Dave350]

Pension? I'm currently putting 5% of my salary which is being matched with 4.25% from my company. I'm upping it to 8% next year when they will match 7.25%.

Remember the first month you put into the home to buy you can put an extra £1k as well, so get more matched.

[Dave350]

Oh, and remember you can't put ANY money into an ISA this year other than the Help to buy one!

[Berz]

Pension is probably worthwhile, that 3% from your employer is better than 0% from doing nothing, and it's usually pre-tax. Obviously a long term thing so you can't rely on it for buying a house.

In addition to the TSB current account there is a Nationwide FlexDirect account paying 5% interest. I've had both accounts for a year now with the maximum balance for the interest and have floated a spare £1500 between them to meet the minimum monthly payment, this takes about 15 minutes once a month. They're both about to revert to 1% but that's fine as I'm about to empty them to buy a house.

If you can commit to 2 or 3 years you might get some better rates from fixed term savers.

[oyster]

On the TSB one:

1. Open the account.
2. Put £2,000 in it.
3. Set up standing order TO TSB for £500 on day x of the month.
4. Set up standing order FROM TSB for £506.67 for the same day.
5. Open a 2nd TSB account and repeat steps 2-4.

[trixical]

oyster said:

5. Open a 2nd TSB account and repeat steps 2-4.

You can only have 1 personal TSB Classic Plus account now for the 5% interest rate, yes it used to be 2 but this was stopped the end of last year, you can hold an additional one in joint names should you have that option available.
(& interest itsnt exactly the same each month due to variation in number of days of the month)

[Nickbrapp]

oyster said:

On the TSB one:

1. Open the account.
2. Put £2,000 in it.
3. Set up standing order TO TSB for £500 on day x of the month.
4. Set up standing order FROM TSB for £506.67 for the same day.
5. Open a 2nd TSB account and repeat steps 2-4.

pretty much what ive done, but only 1 account.

[KTF]

oyster said:

On the TSB one:

1. Open the account.
2. Put £2,000 in it.
3. Set up standing order TO TSB for £500 on day x of the month.
4. Set up standing order FROM TSB for £506.67 for the same day.
5. Open a 2nd TSB account and repeat steps 2-4.

Even better:
1. Open account 1.
2. Open account 2.
3. Put £2,000 in account 1 and £2,000 account 2.
4. Set up standing order from account 1 to account 2 for £500 on day x of the month.
5. Set up standing order from account 2 to account 1 for £500 on day x of the month.
- Point 4 and 5 can be on the same day as its an instant transfer.
6. On the second working day of each month, log in and skim off the interest.

No need to transfer £500 in and out each month as its all done automatically.

[KTF]

Nickbrapp said:

ive also been looking at switching to first direct current account to take advantage of their 6% locked in savers account for a year (max £300 a month) is it worth switching from natwest to them? whats their customer service like?

You dont need to switch to FD. Open a companion product (like an instant access savings account) then you dont have to do any min funding.

Then you can open the regular saver, transfer £300 into your FD current account each month and from there it gets taken automatically to the regular saver.

[gazapc]

I'm on a couple of high interest current accounts for cash savings, easy way to get 4-5%.

For the switching to get a regular savings account you don't need to switch your main account. Just open a sacrificial basic current account with your existing provider and switch that. I just bung a few quid in it and a standing order for 1 quid a month to give them something to switch. Get the regular saver and done! You can also get a £100 switching bonus.

Be careful as atleast with the M&S saver if you withdraw before 12 months you only get 1.5% interest.

[Nickbrapp]

gazapc said:

I'm on a couple of high interest current accounts for cash savings, easy way to get 4-5%.

For the switching to get a regular savings account you don't need to switch your main account. Just open a sacrificial basic current account with your existing provider and switch that. I just bung a few quid in it and a standing order for 1 quid a month to give them something to switch. Get the regular saver and done! You can also get a £100 switching bonus.

Be careful as atleast with the M&S saver if you withdraw before 12 months you only get 1.5% interest.

Great idea! I have a spare barclays account I never use. WIll swap that and get the £100

[Old Merc]

I`ve got a Santander 123 account,it pays 3% on balances between £3K and £20K.Fund the account with £500 (outside money) a month and have three DD`s,you also get cash back on the DD`s.

[PositronicRay]

I have a TSB account with £2k balance. I just transfer some out and straight back in to qualify.
123 for the main house-hold account really a very good offer.