alender
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Post by alender on Apr 16, 2016 15:27:41 GMT
Difficult to argue with people who think that when it takes 1 to 4 business days to withdraw funds there is no interest lost.
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Post by eascogo on Apr 16, 2016 17:19:27 GMT
Is it just me who is finding the rates a little low compared to risk. Santander are giving me 3%, instant access and no risk. TSB give me 5%, instant access and no risk. Tesco give me 3% with the same. Given the risk we take on P2P would have thought the rates would reflect better given the time you have to tie your money up. Not seeing what the attraction is at the moment or am I missing something? Each of the three instant access savers mentioned here has limitations (Tesco 3% up to £3,000; TSB 5% is a monthly saver with interest fixed for 1 year only; Santander 3% for deposits higher than £3,000 up to £20,000 max with £5 monthly fee). In contrast RateSetter has no such limitations whilst offering potentially higher returns. Therefore, in benign market conditions, RateSetter looks a fair bet. However if the risk of a severe market downturn is taken seriously, I would then agree with t5 that the lack of FSCA protection requires a higher interest differential. A number of P2P platforms offer substantially higher rates for arguably similar risks. Under bad conditions liquidity is likely to freeze or force substantial discounts, and capital losses are likely. The level of protection offered by some platform, including RateSetters, should not be expected to cover difficult market conditions, hence the justification of expecting a better rate.
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happy
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Post by happy on Apr 16, 2016 17:42:21 GMT
I have never had a withdrawal from RS take longer than the advertised next day, 4pm and I would obviously not withdraw on a friday thru sunday to avoid longer delays than this due to the weekend.. I accept it is 1 days interest lost getting money out but I don't have money constantly moving in and out of P2P accounts so the overall effect for me is negligible and is more than compensated for by the higher overall interest rate gained and the ease of switching reinvestment into drawdown. I would agree with you that for people who are regularly moving money in and out of P2P accounts it would have a bigger impact, I only have this kind of activity going on between my multiple interest paying bank current accounts which I consider are accounts (and organisations) designed to support this kind of activity. In a perfect world all transfers to/from P2P would be instant but due to costs most are not. However, with the way I manage my money flows the occasional 1 day loss of interest has minimal effect on my overall investment return. Now 3 days wait from the likes of FC, well that does annoy me somewhat
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alender
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Post by alender on Apr 16, 2016 19:31:23 GMT
I accept your point that FC has what looks like an appalling payment system, 3 days wait is not acceptable.
I too try never to withdraw money on a Friday and in defence of RS they have told me that anything that matures over the weekend will get the full weekend interest. However I cannot control the repayment dates so if I have a repayment on a Friday and the rates are too low for me I cannot get that money gaining interest outside of RS until Monday at the earliest. On the Thursday before Easter I have a decent sum mature on the one month market, I requested a withdrawal early on that day, funds did not arrive in my bank account until sometime after 5pm on Tuesday, RS said they were very busy that day due to Easter. I therefore lost 6 days interest.
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happy
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Post by happy on Apr 16, 2016 19:56:43 GMT
Ouch! 6 days! Now that is not so good! Perhaps I will avoid busy holiday periods when moving bigger sums, thanks for the info.
Of course now with more flexibility in selling out on the rolling market you can always shunt your maturing money to a more convenient date but reinvesting and then selling out when you want to transfer the money. Not tried this myself but in thoery it should work better than either uninvested money sitting around or transfering on a Friday afternoon and not seeing the money until Monday pm.
BTW I just worked out that to match my max in RS rolling over the last 12 months in FSCS protected accounts I would have needed to open and then fund monthly over 24 interest paying current accounts between me and my better half. As there are only 4 credible providers left offering accounts (2-3k max in each) that we don't already use to the maximum I reckon that would only give us a maximum of 12 each holding individual and joint accounts with all so it is not practically achievable anyway. Average return would be 2.8% as opposed to about 3.7% in RS and I wouldn't need most of the accounts now as my cash has been redistributed elsewhere.
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ikorodu
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Post by ikorodu on Apr 17, 2016 10:39:43 GMT
I agree that recent rates are close to the not worth the risk end of the scale. The monthly at less than 3% is my absolute limit. Normally manage 3.5 ish.
Have stopped using the 3 year market as for me the rates do not reflect the risk.
Only in 5 yr and monthly now. With 5 year 6.5 % is my limit.
But every one is different. I'd guess it all comes down to ones risk appetite.
BTW I have the Santander 123 acc maxed out which works well as my bill paying account. After fee I normally collect around £55 a month which goes into the RS monthly market automatically.
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