Best way to use Best Buy Current & Savings accounts

P

Peterus

Registered User
Messages
15
Hi,
I'm trying to get the best interest for may wages. I see this as a combination of 1) credit interest current account and 2) a regular savings account.

From the Best Buys post (Thanks guys for the ongoing work updating this)
it seems like 1) Halifax and 2) Anglo

Reading the Halifax rules I need to deposit minimum of €1,500 pm to get 7.23%
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How it works:
Simply lodge €1,500 to your account each month - you don't even have to keep it there for the entire month. Earn 7.23% EAR interest on balances up to €2,000.

  • Interest is calculated on the balance in your account at the end of every day and credited to your account monthly.
  • The amount of interest you earn will vary depending on how much money is in your account.
  • If you don’t want to lodge €1,500 every month we pay you credit interest of 0.1% on all balances.


Can you tell me if this is true: To get the full amount I would need a balance €2,000 in the account each day of the month. Any more than €2,000 does not receive interest so no point having it there. The balance has to be reduced by €1,500 and a new €1,500 deposited each month.

I'm thinking of getting my wages paid in to Halifax. Paying the bills and moving anything remaining above €2,000 to the Anglo savings account.

Reading the Anglo rules I just have to make a contribution as I like each month. No minimum means I can skip a month if I need to.
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In my case lets say for the sake of argument my net monthly take home pay is €2,500. I get this paid into Halifax.
I've met the requirement to deposit €1,500. I pay my bills and anything above €2,000 I transfer to Anglo.
Next month I get paid and will have a balance of €4,500 + interest from the previous month in the current account.
Again I've put a fresh €1,500 in to the current account. I pay the bill and for sake of argument I have a balance of €4,000.
I then move €2,000 to Anglo and get my monthly interest on the €2,000 in Halifax.
Wash, rinse, repeat.

Makes sense?

Thanks,
Peterus
 

Yes - we use that quite effectively. My OH is paid by paypath, about €2,700 monthly. We always try and leave €2,000 in the Halifax current acc. but the payment to Anglo is automated on the Halifax payments system, very easy. So I constantly monitor the account to make sure the (a) balance stays above €2,000 and (b) that there is enough money to pay Anglo and the INBS (though I have reduced that to nominal €200 as they have cut the rate to 1.6%) Anything over that I transfer over and back to the Flexisaver acc. again in Halifax. I should point out that we use a different bank current account for main bills, Phone, ESB, mortgage, health insurance etc. It's a bit of work and the rates are falling regularly but I am nearly 12 months in now so I am happy with it so far.

Slim
 
the INBS (though I have reduced that to nominal €200 as they have cut the rate to 1.6%)
Click to expand...

Source? There seem to be conflicting reports on this. INBS' own website hasn't been updated.
 
Hi Slim,
Good to hear you're benefiting from the interest. I did some calculations to work out what the value of the interest would be. I had to look up the definition of EAR and it is different to AER. What I've worked out is EAR includes any fees or charges and AER does not. So 5% EAR is better than 5% AER as fees and charges have yet to be applied to the latter.

On the Halifax High Interest Current Account if one was dedicated and used the facility optimumly one would get 7.23% EAR on €2,000 over the course of 12 months. This amounts to €144.60 (before DIRT) annually. Which is €12.05 per month.

Is that right, you get €12.05 per month on a consistent €2,000 balance?

Thanks,
Peterus
 
Hi Fungus,
Yes I was not including the DIRT. Thanks for refining this. Still its €108.45 for having a current account and being diligent. Last year I paid about €50 in charges to AIB. I've become very concious of expenses this year.

Peterus
 

Yes, keep the balance above 2K to get full interest.
However, the balance does not have to be reduced by €1,500 per month. You simply need to put a new €1,500 in each month.

Apart from the interest, no banking fees is also a great plus.
 
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