# Regular savings



## robert 200 (10 Jun 2014)

I cannot get a straight answer from E.B.S.

If I save 1000 € monthly in a regular savings account for 1 year

that lump sum of 12,200 € approx is transfered to another interest rate.

What is that current interest rate?

Thanks


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## Lightning (10 Jun 2014)

Yeah, EBS are as clear as mud when it comes to declaring the interest rate that applies to the Family Saver account from month 13 onwards. I have raised this directly with EBS before. 

The rate you are getting is the "EBS 1 Year Fixed Term Savings Account *for rollovers*". That is not the new business EBS 1 year fixed term deposit rate but rather the rate for existing roll-over business which is normally much lower. 

In a nutshell, you are best off taking all money out of the EBS Family Saver account on the first anniversary. An instruction needs to be received by EBS before the first anniversary. 

EBS make money off people who do not give an instruction to withdraw before the first anniversary when the headline rate ends.


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## robert 200 (10 Jun 2014)

Many thanks Ciaran but what is the current rollover interest rate?


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## Lightning (10 Jun 2014)

The year 2 rate is not published. You will need to ask EBS. 

The new business rate is 1.95% for a 1 year term with EBS. Hence, most likely, the rollover rate, is much lower than that.

Regardless, you are best off moving your money elsewhere.


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## Steven Barrett (10 Jun 2014)

Robert

EBS are offering 2.5% AER on their 12 month regular saver account. 

If you only get €200 net after 12 months, you are only getting 0.5% gross. 

Steven
www.bluewaterfp.ie


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## Lightning (10 Jun 2014)

It seems that Robert has had the product for 1 year as he is querying the year 2 rate. The rate one year ago, around this time, was 3.10%.  

The average balance on an EBS Family Saver if you save 1,000 EUR per month and also make a 1,000 EUR initial deposit would be 6,500 EUR. 

6,500*0.031 = 201.50 EUR gross. Perhaps, that is where the 200 EUR calc is coming from. Just a guess.


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## robert 200 (11 Jun 2014)

So is it fair to say that there is a significant difference between the interest rate

offered on a regular monthly saver account and the interest rate offered on the 

rollover account after 12 months?


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## Steven Barrett (11 Jun 2014)

CiaranT said:


> It seems that Robert has had the product for 1 year as he is querying the year 2 rate. The rate one year ago, around this time, was 3.10%.
> 
> The average balance on an EBS Family Saver if you save 1,000 EUR per month and also make a 1,000 EUR initial deposit would be 6,500 EUR.
> 
> 6,500*0.031 = 201.50 EUR gross. Perhaps, that is where the 200 EUR calc is coming from. Just a guess.



Gotcha. From the OP and subsequent replies, I wasn't too sure. 




robert 200 said:


> So is it fair to say that there is a significant difference between the interest rate
> 
> offered on a regular monthly saver account and the interest rate offered on the
> 
> rollover account after 12 months?



Yes. All banks do that. They offer you a good fixed term rate but once that term is over, it rolls over into their ordinary deposit account. It is up to you to request for a specific term and the rate that goes with it again. The bank won't do it for you, that would only cost them money. 


Steven
www.bluewaterfp.ie


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## Lightning (11 Jun 2014)

robert 200 said:


> So is it fair to say that there is a significant difference between the interest rate
> 
> offered on a regular monthly saver account and the interest rate offered on the
> 
> rollover account after 12 months?



Yes, the rate is much lower. Again, you are best off withdrawing your lump sum after 12 months and switching.


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## Lightning (11 Jun 2014)

SBarrett said:


> Yes. All banks do that. They offer you a good fixed term rate but once that term is over, it rolls over into their ordinary deposit account. It is up to you to request for a specific term and the rate that goes with it again. The bank won't do it for you, that would only cost them money.



Yeah, exactly you should give an instruction. 

Banks go a variety of different things at maturity point if you don't give an instruction. Default instructions vary. 
(1) Some banks move the money into a notice account at a low rate 
(2) Some banks move the money into a special roll over instant access account at a low rate. 
(3) Some banks move the money into their highest instant access rate. 
(4) Some banks roll the money into a new term at the new business rate. 
(5) Some banks roll the money into a new term at a lower roller over. 

Generally, default instructions suck and you should always give an instruction. I think default instructions that give the bank the right to roll over a deposit into a new term without an instruction should be banned.


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