Answer: Life for savers who don’t want to go online has certainly gotten harder – just at a time when all savers should check what rate they’re earning.
Even if you opened a savings account 12 months ago, it is highly unlikely to be competitive today. At the time, the Bank of England’s base rate was at an all-time high of 0.1%, with bank savings accounts paying similarly low rates. The base rate is now 2.25%, but don’t assume your bank will have increased what they pay you – in most cases they don’t have to.
With inflation at 8.8%, every percentage point of interest counts. Your money is devalued by inflation, and while you can’t link it to a savings account, the closer you get, the better.
It’s worth checking out what you’re currently earning and what you could earn with another bank or building society, using a comparison site. You will likely find that the highest paying accounts can only be opened and operated online or even in some cases can only be accessed through a mobile app.
It’s not just the top accounts where offline savers lose out. The average rates offered by providers with widespread branch access are significantly lower than those offered by online and app-only providers. When we looked back in August, before rates really started to skyrocket, online-only instant access accounts were paying 60% more interest than their counterparts with branch access.
Branches, call centers and the processing station all increase the cost of running banks, so it may be normal that these services are not available with the highest paying accounts. But with the Bank of England’s base rate at 2.25%, there’s no excuse some high street giants aren’t paying savers just 0.15% interest.
Smart Money – Sam Richardson: Make sure you take steps to avoid becoming a victim…
You can do better than these pathetically low rates and a few providers offer both affordability and decent interest, although you might not find them on the high street. Coventry Building Society is a who? Recommended provider of savings accounts, and you can open and manage an account by phone, mail and in branch. Kent Reliance and Skipton Building Society also offer competitive rates and a variety of ways to manage your account.
Not everyone can bank online, whether due to poor connectivity or disability. But if you’re able to go online, you can protect yourself from scams with a few simple tips. Avoid searching for “best savings rates” or similar terms. We’ve seen scammers advertise and build entire websites to get to the top of search engine results. Instead, go directly to bank or building society websites or try which.co.uk/money to compare different accounts.
Beware of emails claiming to be from your bank, especially when they ask you to provide information, download files or click on links. You can call your bank (using a trusted number, like on your bank statements) to ask what you were told.
Staying offline will unfortunately not completely protect you from scams. Fraudsters are equally adept at finding victims over the phone – they may call claiming to be from your bank, the police or another trusted organization. Hang up, take five minutes to think about what you have been told and, as with email, call the organization concerned using a trusted number.