Nationwide Reducing Rate

Shanker

paparossco wrote: »

I went by this http://www.nationwide.co.uk/products/savings/flexclusive-isa/features-and-benefits

The trouble is here is that they are virtually blackmailing you into taking out a current account that you might not otherwise want.


This is not a display of "loyalty". Its another method of extorting more money from you.


I hold various fixed term cash ISA accounts over £40,000 saved with Nationwide. I also hold a so called "Loyalty Saver 15yr account. I say "so-called" because loyalty means nothing to Nationwide - its a one way street! This is all addition to the Instant ISA Saver 2 that they are about to reduce the rate on. Should I not be rewarded with some sort of loyalty solely for this without having to transfer my current account arrangements to them too?


The terms and conditions aren't that attractive. The amount you can earn interest on would make the return almost negligible and you have to deposit £750 a month with them for the privilege!


What do Nationwide want - blood?

The_stingemeister

Very short notice to give for the interest rate drop also. Was on the verge of adding to the Nationwide isa account...no chance of that now. A bit cynical this, just 2 months after the start of the tax (and isa) year when people may of contributed based on that current rate.

Yorkshire_Pud

I've just cancelled a transfer in to my Nationwide Flexclusive ISA and sent the rest to Coventry!

Vote with your feet.

ISA used to be the first call for the savvy saver, now they are just a holding account paying rubbish interest rates whilst looking for better alternatives, of which there are many.

eskbanker

economic wrote: »

maybe put it into the stock market for dividends.

There are many good reasons for investing in equities but a drop in an instant access cash ISA interest rate is unlikely to be one of them! Savers and investors should consider their objectives, timescales, attitude to risk and all sorts of other circumstances before making strategic decisions to change from one to the other....

Shanker

Yorkshire_Pud wrote: »

I've just cancelled a transfer in to my Nationwide Flexclusive ISA and sent the rest to Coventry!

Vote with your feet.

ISA used to be the first call for the savvy saver, now they are just a holding account paying rubbish interest rates whilst looking for better alternatives, of which there are many.

Just had a quick peek at the Coventry after reading your post.


Trouble is their Easy Access equivalent of the Instant ISA Saver Issue 2 won't allow transfer.


None of them make it easy do they.


Why is that they don't like transfers? Don't they want your money? Where do they think it comes from?


It virtually means that you have to withdraw your funds, which may or may not be over and above the annual limit imposed for new accounts and lose your tax free status on that account so you can place it somewhere else for only a slightly better return. It makes it less worthwhile all the effort involved.


Then of course if you have anymore money lying around that needs a place of safety you can't invest it in an ISA if you are already up to your limit because you have committed.

retiree

Their Instant ISA Saver rate is dropping from 1.5% to 1%.

Vortigern

pafpcg wrote: »

I can quote from a letter from Nationwide about a Flexclusive ISA Issue 9, received in the post this morning (but dated 16 April!):

"Your current interest rate is 1.60% AER (variable). From 1 June 2016, your interest rate will be 1.20% AER (variable)."

I also received this letter today.

We are all missing the key point here. Banks are required to give advance notice when reducing their ISA rates.

Sending a letter dated 16 April that isn't delivered till 6 May is totally unacceptable for a change due on 1 June.


There's only a pound in my account at the moment, otherwise I'd complain.

bowlhead99

Shanker wrote: »

First of all I asked why the rate was reducing from an already appalling rate to an even worse rate - they of course off loaded the blame to the Bank of England who control the rates. I replied, "but the Bank of England haven't effectively changed their base rate since the crash in 2008, why have you changed yours?"

The BoE rate is one of the primary drivers of market interest rates. There are of course other factors. When the BoE rate fell in 2009, the market interest rates remained at a relatively high multiple of base rate for quite some time. Over time, the market rates have gradually fallen, drifting down towards that rate. So, it is quite reasonable to suggest that one of the reasons for the fall is the low base rate, even though that base rate hadn't actually changed last week or last month or last year.

I expect you didn't complain when in 2009 and 2010 they offered you many times the base rate, even though the base rate had fallen dramatically. You didn't say "hey, base rate has dropped to half a percent, why haven't you dropped your top savings products to only pay half a percent please, I would be happy for your rates to track base rate exactly". Instead you accepted the base rate being out of sync with your account rate, because it suited you.

I asked why they were offering 3.25% for junior savers but knocking the rates down on the older, long standing loyal customers. The phone went silent again.

Junior savers do not have large amounts of cash so it is very easy to give them a nice little sweetener of 3% on their £100 birthday money without having to put up mortgage and loan rates or risk going bust - because 3% is only £3. You would not be happy with £3 interest on all your money, so it would be quite costly for them.

They offer you 5% on £2500 in a current account with them for a year, which they don't offer to junior savers, which is £100 a year after basic tax ; but you think it's negligible. If you think £100 a year is negligible then you would definitely think £3 a year was negligible, so they might as well give the £3 to the child instead.

Statistically, relative to the child, you will die quite soon. And you will start to use up the money you've accumulated. Whereas the child is accumulating, and may live for another 90 years and become very wealthy, and will have parents who are in gainful employment and in the market for all manner of banking services. So it makes sense that it's worth paying nice rates to kids.

I asked why can you offer better rates for a current account, (something that I don't want because the offer again is only short term on a relatively small amount of money that can be held on deposit),

You probably know very well why banks can offer good rates on small amounts of money on condition you are putting relatively meaningful amounts of money through their current accounts. There is no point taking your frustration out on a call center clerk.

or even a oxymoron account called a "Loyalty Saver".

it is called a loyalty saver because people who have demonstrated their loyalty to the building society by being a customer for a long period of time are given higher rates on meaningful amounts of money than if they had only been with the society for five or ten or no years.

They have no answers. They are just plebs off the street in a call centre. The wheelers and dealers on the big bucks are in their high rise corner offices overlooking the city through plate glass windows, laughing at us.

Good for you that you have reached that time of life where you can retire and cease working or investing your money in anything productive, sit back and relax and characterise the lowly banking staff as plebs because they have to work for a living while paying into the NI fund that pays your pension.

They probably wish they could simply leave money in an account and demand to be compensated at rates higher than inflation for taking no risk. Sadly they don't have your level of assets but maybe many of them realise it's an unrealistic goal anyway.

You sound disappointed that you only get to speak to cheap call centre employees. When you phone up with your queries, or list of rants and demands, you would prefer to be put through to someone with a PhD in finance because you're disappointed that the call centre clerk's script isn't able to sufficiently articulate the reasons for rate changes in a long term low-interest environment.

However, you don't want to pay to have the call centres of a business with millions of customers manned by highly educated or senior managerial staff, just to explain the basics of economics to you, because that would increase the product fees or lower the interest rates they can afford to offer you.

So perhaps you should have taken your 60+ years of life to date, and used it to do a bit of reading to educate yourself.

Then you wouldn't need to waste your time and theirs by calling up and berating the hard-working junior employees, creating awkward silences by being a difficult customer. It would have also saved you the effort of gleefully posting a transcript here to massage your own ego like some idiot.

I am a retired pensioner. The manner in which the government and financial industry treats us is appalling.

It's funny, because if you did a poll, you could find someone from every generation that would say that their generation was being treated appallingly by the government, and you'd find that with the last government and the one before that, back for hundreds of years.

Yet each time, the government that's in power was in that position because more people wanted their MPs than "the other lot" who had been up for election.

Unless you tie your money up for several years on rates that are still extremely poor and certainly do not compete with inflation, you are !!!!!!ed!

But what do you do, even if you put it into Premium Bonds it seems pointless as they have engineered the odds almost totally in their favour so even a small tickle of £25 is unlikely.

There just doesn't seem anywhere to put money where it's safe and can earn a decent return.

Why do you deserve a 'decent return' for doing nothing with your money and demanding it is always available for you to access easily or immediately the next day with no risk of loss, to spend or move it anywhere in the country at a touch of a button online for free? You don't want to give it to the bank long term to lock into a higher rate. You don't want to risk it. What exactly should they be paying you for?

Whether inflation and base rate is 4-6% and interest rates are 4-7%, or inflation and base rate is 0.5-2% and interest rates are 0.5-3%, you're not really going to grow your wealth or earn a sustainable real terms income from a cash savings account. Perhaps you should consider investing some of your tens of thousands of spare cash instead.

All I want is ...

... the moon on a stick?

Shanker wrote: »

I hold various fixed term cash ISA accounts over £40,000 saved with Nationwide. I also hold a so called "Loyalty Saver 15yr account. I say "so-called" because loyalty means nothing to Nationwide - its a one way street! This is all addition to the Instant ISA Saver 2 that they are about to reduce the rate on. Should I not be rewarded with some sort of loyalty solely for this without having to transfer my current account arrangements to them too?

I use their current account services, credit card, £500pm regular saver and mortgage. All are competitive in the market. The 15yr loyalty saver available without needing to have a current account is not a bad rate compared to its rivals. Notably it's higher than what they would pay me for a general savings account because I've not used them for quite as long as 15 years. So you are getting rewarded for being a long term customer even though I am paying them £15k+ a year in mortgage interest.

What do Nationwide want - blood?

What do you want - something for nothing it seems? If you don't like it, vote with your feet.

roddydogs

Ouch, calm down dear, its only a blog.

Stompa

Vortigern wrote: »

Sending a letter dated 16 April that isn't delivered till 6 May is totally unacceptable for a change due on 1 June.

Agreed, and I haven't even had my letter yet.