Any Tips on Minimizing Bonus Interest Loss When Withdrawing from Rams Savings Account?

Danam on 16/02/2019 - 12:02

Hi,

I would like to move some (~25%) of my Rams savings to another bank that has a better interest rate, however doing this appears to hurt me overall as I would lose the bonus interest on the remaining Rams funds for at least a month. The Rams help desk suggest moving it out on the 1st to at least obtain the bonus for the previous month.

The only thing I can think to do is transfer out all of my Rams savings to another bank who will pay a decent interest rate immediately and then move what I wanted to stay with Rams back when the bonus is re-instated.

Does anyone have any strategies for dealing with this?

Financial

Comments

  • Neoika on 16/02/2019 - 12:34
    +7

    Open another Rams Saver now (Up to 10 if I am correct). On 1st March, which is a Friday morning, move 25% to the better rate account and 75% to the new Rams Saver.

    If you have a few Rams Savers, you can always have at least one account with no transfer-out record in a month (to recieve the bonus interest rate).

    • Danam on 16/02/2019 - 12:58

      Nice. Thanks for the out-of-the-box thinking there. The Rams help desk did mention opening a new account as part of a strategy, but I got a bit lost with the logic. This makes perfect sense.

      • Ms Bargainer on 17/02/2019 - 03:05

        Yes, I have two Rams accounts.

    • natman on 16/02/2019 - 15:43
      +2

      You can transfer $200 to the new account now, to make sure that the bonus interest rate is activated for the following month. I don’t know if this is necessary, but I would do it just to be safe. Edit: transfer from some other account, not Rams.

      • bluesky on 16/02/2019 - 16:51
        +2

        With RAMS, pretty sure the $200 is to qualify for the bonus rate of this month, not next month (unlike ING).

        Also, the $200 can be funded from an existing RAMS account (unlike ING). Although you would not do this in the middle of month - natman is right about using an external account if you are creating the account now. And also transferring in $200 or more, so that the remaining days of this month also get bonus rate (if account is created now). For future addition of $200 to RAMS accounts, typically on the 1st of the month, funding it from other existing RAMS accounts is fine.

        The other option is create additional RAM saver account(s) on the 1st March. The account can be created and used straight away.

  • JimmyF on 16/02/2019 - 14:30
    -5

    The Rams help desk suggest moving it out on the 1st to at least obtain the bonus for the previous month.

    It doesn't matter what day you it, its treated as a month. Take it out on the 1st or the 15th of the 31st and its still a withdrawal for the month so no bonus interest.

    Either just forgo the bonus interest for 1 month (its not mega dollars you're talking about) or do what is listed above.

    • Donaldhump on 16/02/2019 - 14:59
      +1

      this is the worst logic fail i have ever seen on ozbargain. rethink your answer through, its not that cryptic.

      you move 90k from the 100k in account A to account B on the first and the 90k in account B gets a month of interest

      you move 90k from the 100k in account A to account B on the 15th and the 90k only gets 15 days of interest, the first 15 days are forfeited.

      you move 90k from the 100k in account A to account B on the 30th and the 90k loses all its interest.

      • JimmyF on 16/02/2019 - 21:39
        -7

        this is the worst logic fail

        Your logic is failed, not mine. Its clear you haven't read the T&Cs of this account or had an account like this before. I'll make it simple for you, and copied straight from the RAMs website for you.

        To earn the bonus 1.65% p.a. variable interest on top of the variable base rate, just:
        Deposit at least $200 during the month
        Make no withdrawals during that month

        So don't put $200 in that month and you don't get your 1.65% BONUS interest, but you still get your 1.15% p.a.standard interest

        but if you also make a withdrawal of any amount at any time during the calendar month, you forgo you your 1.65% BONUS interest for that month, but you still get your 1.15% p.a.standard interest.

        So yes it doesn't matter when you take the money out. The bonus interest is paid monthly and ONLY if you meet those terms.

        So on $100k, that 1.65% is worth a whopping $137.50 a month (before tax). Not really worth all the hassle of worrying over for a once off move if you ask me.

        • Donaldhump on 17/02/2019 - 05:30
          -1

          So ur happy to blow money by not waiting a day. Mental.

          And I know this because I once had 7 figures after a home sale sitting in rams for 3 months and then had to move it some out. I even made my next house purchase settlement on the 3rd if the month deliberately

          Doing it on the 31st vs 1st was a difference of 4K ish so yeh it is a bit of money.

          It does matter when you take the money out , as you forfeit money in the current month only . What do you not get. Anyway if you don’t get it no point discussing as it’s basic logic, but here is one last ditch attempt.

          On 31st open account b and pay 200 bucks, on 1st move what you do not need to account b., no interest at all lost.

          Do this one day earlier you lose you entire month of interest. If the sake of careless logic costs you 100 dollars and you don’t care, I’m happy to take that money off you

          • JimmyF on 17/02/2019 - 14:52
            -1

            @Donaldhump:

            So ur happy to blow money by not waiting a day. Mental.

            any withdrawals during that month for forfeits the bonus interest……

            I once had 7 figures after a home sale sitting in rams for 3 months

            Rams saver maxes out at $500k….. So you would have only been getting bonus interest on that

            On 31st open account b and pay 200 bucks, on 1st move what you do not need to account b., no interest at all lost.

            Interest is paid daily, so you would get your bonus interest for 1 day. hahahahaha sure

        • Danam on 17/02/2019 - 12:36

          Hi Jimmy, thanks for the input, but when you are juggling quite a bit more than that it does become significant money. Buy even with your example, having the bank pay a good chunk of the grocery bill sounds good to me.

          I don't really see maximizing free money as a hassle anyway. I think many of us see it as a bit of a game.

          • JimmyF on 17/02/2019 - 14:49

            @Danam: Well it can't be any more tha $500k, so $685 a month then :)

    • Ms Bargainer on 17/02/2019 - 03:08
      +2

      If you take the money out on 1st you will not lose intertest, as it has not been in there long enough to accrue it. However, if you do it on 15th that is two weeks of interest your money could have earned at another bank.

  • Seraphin7 on 16/02/2019 - 18:43

    Take out the whole shebang on the 1st of the month and put it in UBank or wherever you can get a good rate without catches. Put whatever you have left back on the 31st.

    • Danam on 17/02/2019 - 12:26

      Hi Seraphin, UBank has a deposit limit of $200K. I have been hit by exceeding this before. You not only lose the interest for that month, but need an entire month of 'behaving' to re-instate the bonus interest.

      • Seraphin7 on 17/02/2019 - 13:32

        Just an example … as noted, wherever you can get a good rate without catches.

  • RockyRaccoon on 17/02/2019 - 03:00

    If the other bank has a better interest rate, why aren’t you moving all the funds rather than just 25%? Problem solved (do it on first of month etc)

    • Danam on 17/02/2019 - 12:24

      Hi Rocky, I am trying to bump up my UBank USaver (2.87%) to near the $200K limit. Rams (now 2.8%) was a more attractive option a few months ago.

  • Ms Bargainer on 17/02/2019 - 03:10

    May I ask what is the other bank and its interest rate?

    • Danam on 17/02/2019 - 12:29
      +1

      UBank (2.87%). There are better options out there, but I am not all that into the 4-month promo offers or the requirements to tap-and-go every week. I'd rather set up my auto payments of $200/month and forget about it.

  • HeWhoKnows on 17/02/2019 - 18:07

    Sounds good to me.
    Or just open another online savings account.
    The AMP Saver is EXCELLENT as an ongoing savings account.
    No need to keep moving your money around and no penalties for withdrawing or not depositing.

    https://www.amp.com.au/personal/banking/products/savings-acc…

Login or Join to leave a comment
Login Join