Playing Regular Saver Games to Maximise Interest

[Lightning]

We are in a low interest environment, rates are on a downward slope and the ECB might be about to cut rates again.

Most people, with lump sum deposits, go for a term deposit or an instant access account. They often neglect to look at regular saver accounts because they are not saving per month but rather have a lump sum.

The oversight to look at regular saver accounts may result in those getting a much lower return for their money.

Drip feeding multiple regular saver accounts is often the way to maximise the return on your lump sum. It is not for the faint hearted nor for those that don't like 'hassle'.

Example: Large lump sum deposit.

Step 1: Move lump sum to KBC Smart Access @ 2.30% or whoever at the time offers the highest lump sum rate with no withdrawal restrictions.

Step 2: Open the below accounts in ORDER depending on the size of the lump sum:
2.1 Nationwide UK Euro 15 Month Regular Saver @ 4.00% (€1,000 a month max; maximum amount in account to earn this rate €15,265.01; maximum period 15 months)
2.2 KBC Regular Saver @ 3.50% (€1,000 a month max; maximum amount in account to earn this rate €50,000)
2.3 EBS Family Saver @ 2.75% (€1,000 a month max; maximum amount in account to earn this rate €12,000; maximum period 12 months)
2.4 PTSB Online Regular Saver @ 2.70% (€1,000 a month max; maximum amount in account to earn this rate €50,000)
2.5 PTSB 21 Day Regular Saver @ 2.65%. (€1,000 a month max; maximum amount in account to earn this rate €50,000)
2.6 1-4 AIB Online Regular Saver accounts @ 2.75%. (€1,000 a month max; maximum amount in account to earn this rate €12,000; maximum period 12 months)

Summary of how these accounts operate is here: Regular Savings

(The heavy T&C's on the AIB Online Regular Saver have pushed it down the list).

Step 3:
3.1 Wire money from your KBC account to your current account manually each month to maximise your regular saver payments.
3.2 Manually wire money from your current account into the NUK account monthly making sure that you are doing the minimum per month. Close the account after 15 months and wire the money back into the KBC account. Watch the rate frequently.
3.3 Direct debit money from your current account to the KBC Regular Saver account each month. Do not exceed circa 48,000 EUR in this account. Watch the rate frequently.
3.4 Direct Debit money from your current account into the EBS Family Saver account. Close the account after 12 months. Give an instruction prior to the 12 month maturity and wire the money back into the KBC account.
3.5 Manually wire money from your current account into the PTSB Online Regular Saver account each month. Do not exceed circa 48,000 EUR in this account. Watch the rate frequently.
3.6 Manually wire money from your current account into the PTSB 21 Day Regular Saver account each month. Do not exceed circa 48,000 EUR in this account. Watch the rate frequently.
3.7 Open 1-4 (yes, you can open 4 accounts) AIB Online Regular Saver accounts. Direct debit 10 EUR into each account per month from your current account. Manually wire the remainder from your current account. On each 12 month anniversary of account opening, reduce the balance back down to 1,000 EUR per account. Watch the rate frequently.

Too much hassle for some. For others, 10 minutes doing a few wires per month is worth the return.

 

[Brendan Burgess]

Ciaran

That is great fun and brilliantly described.

Are the following steps really worth doing?

2.3 EBS Family Saver @ 2.75%
2.4 PTSB Online Regular Saver @ 2.70%
2.5 PTSB 21 Day Regular Saver @ 2.65%.
2.6 1-4 AIB Online Regular Saver accounts @ 2.75%.

As you can get 2.5% from a lump-sum in KBC, why would you go to this amount of trouble for an extra 0.25% (2.75 -2.5)

On €100,000 0.25% is €250
As it takes at least a year to build up to this, the savings in the first year would be: €125
After DIRT, that comes out at about € 75

By having 6 or 7 accounts, you could well make an error which would cost you €75, so I think you should stop at step 2.2

I suggest the following would be a helpful edit to your post

2.1 Nationwide UK Euro 15 Month Regular Saver @ 4.00% ( €1,000 a month max; maximum amount in account €15,000)
2.2 KBC Regular Saver @ 3.50% (€1,000 a month; maximum in account €50,000)

 

[Lightning]

Are the following steps really worth doing?

2.3 EBS Family Saver @ 2.75%
2.4 PTSB Online Regular Saver @ 2.70%
2.5 PTSB 21 Day Regular Saver @ 2.65%.
2.6 1-4 AIB Online Regular Saver accounts @ 2.75%.

As you can get 2.5% from a lump-sum in KBC, why would you go to this amount of trouble for an extra 0.25% (2.75 -2.5)

The 2.5% KBC instant access rate is only paid to choose who open a current account and pay current account fees. Hence, fees need to be factored into the above equation.

The more comparable instant access rate is 2.3% with the KBC Smart Access account.

Granted, hassle is a factor.

By having 6 or 7 accounts, you could well make an error which would cost you €75, so I think you should stop at step 2.2

Some people should stop at 2.2, those that know what they are doing could open more than 2 accounts.

I suggest the following would be a helpful edit to your post

2.1 Nationwide UK Euro 15 Month Regular Saver @ 4.00% ( €1,000 a month max; maximum amount in account €15,000)
2.2 KBC Regular Saver @ 3.50% (€1,000 a month; maximum in account €50,000)

Good idea, I will edit the post shortly.

 

[Lightning]

I had same experience as Gervan, opening lodgement of 1000 on July 31st and made another on 12th August. Worked as well on my wife's account. That gives another piece of advice that you might consider adding CiaranT -open accounts for your spouse if you have one and do everything x2

There is already a note at the bottom of the regular saver best buys that says "To increase your maximum monthly contribution, it may be possible to open a joint account with your partner." I will change this to say "To increase your maximum monthly contribution, it may be possible to open a joint account with your partner, or you could choose simply to both open one account each". Thanks for the suggestion.

 

[bravo]

Well done CiaranT on an excellent post.

I have been using a similar model for a while and one little option on the current account:

I use UB and apart from the "odd technical issue" - its free banking if you deposit €3,000 per month - easily managed if you're transferring maximum amounts to regular savers.