A financial expert has highlighted a simple – and legal – financial trick that can easily earn you ‘thousands of pounds’ with just a few clicks of a button. Gabriel Nussbaum, also known as That Money Guy, was speaking to consumer group Which?.
He was talking about ‘mule accounts’, which people to use to take advantage of current account switching offers from banks. Gabriel explained: “Some people literally make thousands of pounds from mule accounts.
“A mule account sounds really dodgy but it’s essentially where you have a second current account that you use to take advantage of all the different switching deals. It’s completely legitimate; it’s fine. You can actually have as many current accounts as you want, as long as you’re okay with the credit checks that happen when you open these different accounts.
“People use them to literally have a main account that they do their everyday spending from, they do their transfers, they pay their salary into that one, direct debits, and then a secondary one just to take advantage of the £175 being offered there, then they move on to the £150 offered there. Some people literally make thousands of pounds from mule accounts.”
Gabriel did explain that there were a couple of catches that people need to be aware of before they rushed off to set up their accounts. He said: “There are a few things to be wary of. Understand it will affect your credit score and that you need to cover a lot of requirements to get the deals in the first place.
“For example, a certain amount being paid into your account every single month, or a certain number of direct debits but they are completely legitimate hacks for you to take advantage of and make quite a little bit of money on the side.”
According to Money Supermarket, First Direct are offering £175 to switch to their account. You must have at least two standing orders linked to the account, pay in £1000, log in to digital banking, and make at least five debit card transactions.
This must all be completed in 45 days and you may not have held a First Direct product previously or opened an HSBC account after January 1, 2018.
The MoneySavingExpert website shows that both Nationwide and Lloyds are offering similar deals worth £175, while The Co-operative Bank is offering £75 to switch, plus £25 for three months. All three offers have terms and conditions attached.