MSE Blog: I’ve given up on savings 28 June 2013 at 4:18PM in Savings & Investments 17 replies 2.5K views

Former_MSE_Helen

Hi all, this is a thread to discuss the MSE blog:
I’ve given up on savings


"I’ve finally ditched ‘em. I’m so fed up with the paltry rate I can get on a normal savings account, for the first time in my working life I don’t have one at all..."


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Savings_Dave

I don't have a standard savings account either - it's all high interest current accounts paying 3%. Once these are maxed out your options are pretty limited because the rates are very low. Banks don't seem to need your money to lend out - thanks to QE?

The Santander 123 current account is quite useful if you have a large family with many bills (for the cashback) but useless if your single...there is a £2 monthly fee so my very small outgoings won't cover that. However 3% is available with Lloyds Vantage...so setup three Classic accounts and no monthly fee. Also Halifax Reward £5 a month.

I've bought Premium Bonds instead - that's how bad things are! :rotfl:

Reaper

Sounds sensible enough, Guy. Depending on circumstances you might also like to consider investments as well as savings.

jem16

Savings_Dave wrote: »

The Santander 123 current account is quite useful if you have a large family with many bills (for the cashback) but useless if your single...there is a £2 monthly fee so my very small outgoings won't cover that.

Single people still have energy bills, council tax bills, phone/broadband bills and possibly the likes of Sky.

Should be more than enough cashback there to cover £2pm.

ses101

I suffer from a long term disability, but my money was stopped last year after an ATOS assessment. I am unable to work regardless of what ATOS said, and am therefore completely reliant on my parents for a roof over my head, and what money I have saved up (I have more than the max threshold with regards to being entitled to any benefits). Because the interest rates are so low, my money is going down fast.

So I am unable to work, I'm not entitled to benefits, and my money is going down fast because of QE. Thank you so much government! I'd be as well risking robbing a bank, because at worst I'll still get food and a roof over my head if it goes wrong!

jimjames

Reaper wrote: »

Sounds sensible enough, Guy. Depending on circumstances you might also like to consider investments as well as savings.

I have no savings.

I have investments and I have overpayments on my mortgage but nothing in savings accounts.

innovate

Would be good to hear from Guy why there is no mention of FlexDirect, Vantages, Regular Savers and of investment such as S&S ISAs and/or SIPPs.

Also, what do MSE suggest people do who don't have a mortgage / can not repay it faster should do?

typistretired

innovate wrote: »

Would be good to hear from Guy why there is no mention of FlexDirect, Vantages, Regular Savers and of investment such as S&S ISAs and/or SIPPs.

Also, what do MSE suggest people do who don't have a mortgage / can not repay it faster should do?

I agree except about the S&S ISAs (mine have dropped a lot past month).

Just started today a regular saver with Principality 3% (£500 per month) Yorkshire BS 3% (£250 per month) and Norwich & Peterborough 5% (£250 per month) already have the First Direct 6% one (£300 per month).

innovate

typistretired wrote: »

I agree except about the S&S ISAs (mine have dropped a lot past month).

Everyone's investments took a bit of a dive last month, after the earlier rally over several months.....that is what investments do. They'll rally again at some stage.

This isn't a binary world - it isn't just save or invest. It isn't all about interest you can get on your savings (wherever you choose to hold them) either. Most people can, and should, save some and invest some. Particularly younger people should be encouraged to do just that. Because if about 100 years of history are anything to go by, those that only save, and don't also invest, will be losing out big time. Those that only invest might find themselves in a bit of a pickle if the washing machine and the telly blow up when the market has just taken a bit of a dip.

VT82

I've got all my cash in 123, Vantage and ISAs - it didn't even occur to me I wasn't using savings accounts. 'Giving up on savings accounts'... talk about a mountain out of a molehill!

If your offset mortgage has been paying more than savings after tax, you should have been using that ages ago. Although just be sure it's properly offset - where I work we have what we called 'flexible mortgages', and you are free to overpay and take payment holidays with them, but not to draw your money back out. You might want to check seeing as you described it as 'flexible', and can't overpay by more than 10%, suggesting it's not really an offset mortgage.

BrianD

"Just started today a regular saver with Principality 3% (£500 per month) Yorkshire BS 3% (£250 per month) and Norwich & Peterborough 5% (£250 per month) already have the First Direct 6% one (£300 per month)."

I could not find the 5% N&P reg saver there were lower one's has it changed since you opened the account?