ING - Drops to 4.5% AER from 1st Jan 2006

lolly5648

So what's everyone going to do. I'm inclined to wait until January and see then - the hassle of opening a new account, sending off id etc always puts me off.

hansi

I'm gonna wait too, can't stand all the hassle of moving, not just for 0.25% anyway!

Paulee

I've got to accept the hassle of moving!

I have been with ING for a couple of years and it is our main savings account holding over 300k. I enjoy the simple &, I believe, safe system used by them. I don't make lots of transactions but I do need fairly quick access to my money. The reduction to 4.5% from January is a big issue for us and I am actively seeking a better, but safe, return. It looks as though the best available is from the Abbey e-saver account, giving an average 4.9% over one year (due to new customer bonus), but after this time I will have to switch to another provider as the rate drops to 4.5%.

Does anyone know of a better deal than the Abbey?

al_yrpal

hansi wrote:

I'm gonna wait too, can't stand all the hassle of moving, not just for 0.25% anyway!

Thats what ING are banking on, inertia! This is the second time they have worked this scam. There won't be a third time as far as I am concerned.

Greycrow

al_yrpal wrote:

Thats what ING are banking on, inertia! This is the second time they have worked this scam. There won't be a third time as far as I am concerned.

I agree, they suck you in with an attractive rate, and when they've build up sufficient funds, they slash it.
I accept that financially there may not be much or any gain in changing and individually we do not have much clout.
Banks love investors who can't be bothered, but if enough do it would certainly give them food for thought.

theloft

Greycrow wrote:

I agree, they suck you in with an attractive rate, and when they've build up sufficient funds, they slash it.
I accept that financially there may not be much or any gain in changing and individually we do not have much clout.
Banks love investors who can't be bothered, but if enough do it would certainly give them food for thought.

Totally agree !! ING need loads of us to move our money out and then perhaps they will think twice before becoming un-competitive. I am definitely going to move mine, but keep a couple of quid in there, in case their rate goes back up.

Caped_Avenger

theloft wrote:

Totally agree !! ING need loads of us to move our money out and then perhaps they will think twice before becoming un-competitive. I am definitely going to move mine, but keep a couple of quid in there, in case their rate goes back up.

I think that's a bit harsh.

4.50% AER (not an introductory rate) for an instant-access account, with no withdrawal penalty/loss of interest, no minimum or maximum deposit (i think there's no maximum. If there is one, it doesn't affect me :rolleyes: ) is pretty good, as far as i'm concerned. And i certainly wouldn't call it uncompetitive. Show me another account with all the features of the ING account with a higher, non-introductory, interest rate an i'll re-consider.

ReportInvestor

I also agree that earlier posters may have been too harsh on ING (where I currently hold my main cash savings, but for not much longer ).

Getting the top rates requires companies like ING to run top paying loss making accounts in the hope that people will stay, even after they drop their rates.

MSErs naturally take advantage :snow_laug .

The danger is that if too many people become too savvy, this tactic will not work for companies, so fewer will bother offering stunning rates to attract the new business than will run away as soon as the rates drop.

We've seen the start of such a trend in the credit card 0% initial offer game and also in the rise of heavy fees of £500 for taking out new mortgage deals.

A survey today says that more and more people are switching products regularly.

It's not that MSE contains the seeds of its own downfall, more that the ongoing benefits gained by its expanding fan base may contract slightly as the market reacts.

Juni_3

Caped_Avenger wrote:

I think that's a bit harsh.

4.50% AER (not an introductory rate) for an instant-access account, with no withdrawal penalty/loss of interest, no minimum or maximum deposit (i think there's no maximum. If there is one, it doesn't affect me :rolleyes: ) is pretty good, as far as i'm concerned. And i certainly wouldn't call it uncompetitive. Show me another account with all the features of the ING account with a higher, non-introductory, interest rate an i'll re-consider.

Totally agree with you. I've spent the last few days looking for a better home for my money and I can't find one.

All the others have limits on how much you can put in, ties into other accounts, monthly rates far lower than annual or some other catch.

I probably could pick up 0.1% higher interest but thats a waste of time as it takes two weeks to move all the money around which means it isn't earning anything.

al_yrpal

Juni wrote:

Totally agree with you. I've spent the last few days looking for a better home for my money and I can't find one.

I opened a Nationwide e-saver after ING did 'the lower interest rate than all the others a month early' trick, last time. The interest rate was the same and they never seem to do the dirty tricks ING do. NW did involve a Flex account too. I then realised that I could move savings in literally 10 seconds into the Flex current account and vice versa, saving the ING Direct up to 4 day delay in which you loose interest on the sum transferred. Then NW sent me the debit card which I can draw holiday money totally free of charge from ATM's abroad, dispensing with the need to carry large amounts of cash or travellers cheques. I used it in a Barclays Bank ATM in the African bush this summer. Then I realised that I was actually getting interest on any money in the Flex account too, which I don't in my NW current account.
Then I looked at NW's interest rate and wondered why it was the same as ING Direct's, with NW being 4th in the best buy tables and ING Direct being 14th. It then emerged that you have to keep your savings a full 12 months before you get the advertised rate at ING Direct whereas NW pays the proper rate daily, paid out yearly.

Thats why, later this month I shall move my remaining savings from ING Direct into NW. As ING Direct are a foreign bank who I don't actually know much about, you can't be too careful.