Today we have a guest post from Money Shed forum member Glen who has perfected the art of earning money by switching bank accounts and has made themselves hundreds of pounds for just a few minutes work.
Pssst, fancy earning a juicy carrot tempting £100 – £150 for a few minutes work?
Banks have made it easy these days to switch accounts with the Current Account Switch Guarantee. This means the whole process can be done in just 7 working days (not counting Bank Holidays and weekends).
They like to tempt new rabbits, err I mean customers, with a juicy ‘carrot’ bonus of around £100 to switch to them.
These offers crop up regularly and sometimes include linked saver account offers, so you can benefit even more.
Disclaimer: Please read the t&c’s for all offers before applying to any bank as conditions apply and can vary. Check for any early closure (clawback) clauses.
This is how I Switched (and switched and switched):
Not wanting to lose the Current Account I’ve had for years, I decided to open a second Current Account WITHOUT switching.
I knew this would take 2-3 weeks to set up but I would end up with a ‘dummy’ account to use for switching purposes AND have the reassurance of keeping my usual account with direct debits entirely separate.
I chose a bank that did not have a switching offer and checked online to see which banks were connected, as you can only switch once within each banking group.
The first bank I tried online rejected my application but the second one accepted me. Yippee, I had my ‘dummy’ account. My debit card would be posted shortly.
Most switches require you to pay at least two direct debits out of your Current Account. To get these I opened a Tesco Instant Saver and a Tesco Internet Saver.
Both accounts accept direct debits into them, so instead of paying a bill, you can actually pay INTO YOUR SAVINGS.
I used the ‘dummy’ account for a couple of months, paying money in regularly to cover the direct debit payments.
The next job was researching online to find the best switching offer available.
Having picked a bank, I went to their switching offer webpage.
The first stage is to apply for a Current Account. it is easier to open an account WITHOUT an overdraft.
The form was relatively quick to complete, taking around 20 minutes. My application was accepted and I would get my Welcome Pack and debit card in the post.
Having registered for online banking and paperless as required, I then went to their Switch page. It took less than 6 minutes to complete this stage.
I chose the date I wanted the Switch to COMPLETE – and made sure that this was before the offer end date.
I applied to switch FULLY, confirmed that my ‘dummy’ account had two active direct debits set up on it, and agreed for it to be closed. The new bank would take care of all the arrangements for me.
Whatever happens, do NOT cancel or transfer the direct debits yourself.
As the switch process is a separate application, you actually have around 28 days to apply for it after opening the Current Account but do remember offers can be pulled early.
I was kept informed via text about the progress and on the 7th (working) day my switch was complete. My ‘dummy’ bank was closed and no longer accessible online.
I had my new ‘Switch No. 1’ Current Account.
As long as I paid in a set amount each month with two direct debits going out, then after a certain period I would get the switching bonus ‘carrot’ of £150 paid into my account.
Paying in £500 each month was straightforward – it didn’t have to ‘stay’ in the account for the whole month, just be paid into it. I simply transferred £250 from my usual current account to the Switch No 1 Account, left it in for a day or two, then transferred it back to my usual account.
I repeated the process a couple of weeks later to fulfill the £500 month criteria.
I often made a third transfer taking it over £500, which kept the credit topped up for the direct debits etc.
As the account had no overdraft facility I made certain it was ALWAYS IN CREDIT.
I knew what period my ‘month’ covered and made sure that the £500 payments into the account were within those dates. Some banks view ‘a month’ differently e.g. 28/31 days or it may depend on the date the account was opened, so check this.
For daily transfer limits under £250, do smaller transfers until enough is paid in. It is possible to transfer the money back out on the same day but I left mine for a day or two.
I could have set up Standing Orders to transfer money back and forth automatically but you need to be aware of Bank Holidays and weekends affecting this. I preferred to do it manually within the timescale.
I got my first ‘carrot’ after 2-3 months and carried on using the account for the next 6 months or so. This ‘Switch No. 1’ account would be used for the next ‘carrot’. Munch, munch!
I opened my ‘Switch No. 2’ Account by switching from my ‘Switch No. 1’ Account.
I followed the same process as before, after checking the criteria to open it, and again it was straightforward.
I actually received my second ‘carrot’ VERY QUICKLY. On Day 7 of the switch, the account was credited with £100.
Once completed, Switch No. 1 Account was closed and replaced with Switch No. 2 Account.
I paid in the required monthly amount and had two direct debits going out. I kept the account for a few months.
For my ‘Switch No. 3’ Account I had to set up a new direct debit first as only one of the Tesco ones was applicable.
All direct debits had to be ‘active’ e.g already made payments out of the account being switched. This took about 3 weeks to implement fully.
I applied for the Current Account online first. By the time I had received the paperwork and debit card my new direct debit had been paid out of the Switch No. 2 Account. It was then a simple matter of going back online and completing the switch to the new account.
Having paid the monthly direct debits out and the required amount in (and out) I will keep this account going for a few months until the next offer.
Important Update to Tesco direct debits, for anyone who switches current accounts etc.
From April 2018 the Tesco Instant Saver and Tesco Internet Saver Accounts will no longer accept any DIRECT DEBITS into these accounts. This applies to both old and new accounts.
Any direct debits currently set up on these accounts will also be cancelled.
Hopefully I should receive my third ‘carrot’ of £130 after my account has been open for 28 days.
Munch, munch! Anyone hungry?