Is this the end of the regular saver? - blog discussion

talexuser

RG2015 wrote: »

At 2.5% it would be £16 a year, or 4.5p per day.

The rate is now 2%, which is only ~£8.12 more than the same regular payments into Marcus

talexuser

Vortigern wrote: »

What loss? There's no fee for BoS Vantage even when there's no monthly funding and no DDs.

The loss of keeping the 5k I had in when the rate was 2% (to have the monthly saver) , compared with keeping it in when the rate reduces to equivalent of 1.2%.

jimbow25

The answer for me, as an occasional visitor to this board but a seasonal user of regular savers, is yes, they are barely now worth the hassle from my perspective. You'd be jumping through the necessary hoops to get £45 interest on monthly savings instead of the £25 they'd have got in an instant access ISA (estimated numbers).

I appreciate that posts on here imply otherwise but it's not MSE members and newsletter recipients that the banks are after, with respect. It is the average bank customer that could be persuaded to switch current accounts with the lure of a high interest rate on a relatively small balance. Someone who pays a few thousand in to a current account each month at 0% interest but is seduced by 5% on £250 per month, and can then be sold other products, is surely the target.

However this part of a long-term downward trend in this area just likes others.

• Saving rates are nowhere near what they were pre-2007 (of course)
• Post recession, banks are more inclined to "mind the shop" and not offer what is effectively a loss-leading product
• Maybe they feel the customers that could be seduced with the new easy current account switching opportunity, have largely been snapped up now?
• the above also applies to the best current accounts interest rates offered, which have also been vanishing

I have been logging in and checking the (excellent) best regular saver thread in here with a measure of dread for a few years now as the best rates fall and fall so I see this as more of the same rather than a switch overnight. I only curse the fact that I didn't have the means to make best use of these accounts when they were available (remember Lloyds TSB 8% on £250pm for two years or Halifax 10% on £500pm for one year...happy days!)

polymaff

jimbow25 wrote: »

I have been logging in and checking the (excellent) best regular saver thread in here with a measure of dread for a few years now as the best rates fall and fall so I see this as more of the same rather than a switch overnight. I only curse the fact that I didn't have the means to make best use of these accounts when they were available (remember Lloyds TSB 8% on £250pm for two years or Halifax 10% on £500pm for one year...happy days!)

More to the point, when you could get several percent, even after tax, over inflation in straight-forward £1 - £1m easy access accounts. The best I (think I) remember was 17.1% during a period of about 8% inflation.


The OP misses a point, though. "Is this the end of the regular saver?" As the Professor said - "depends what you mean by regular saver". For years - decades even - the RS had clear characteristics. High fixed rates, no withdrawals, mandatory deposits. Not so now.

RG2015

talexuser wrote: »

The rate is now 2%, which is only ~£8.12 more than the same regular payments into Marcus

My point is that you were fine with £16 per year but £8 per year is not worth the bother.

rawhammered

personally, think I'll rationalise my banking standing orders and just put more into S&S ISA rather than regular savers.

polymaff

RG2015 wrote: »

My point is that you were fine with £16 per year but £8 per year is not worth the bother.

Every man has his price...:)

talexuser

RG2015 wrote: »

My point is that you were fine with £16 per year but £8 per year is not worth the bother.

But the 5K I had in Vantage (earlier 3 Vantages at 3%) was at 2%, lately 1.5%, now 1%, so that was worth it too, while the monthly was ahead. I agree £8 a year is not worth the time of setting up a standing order, or keeping the Vantage either with £1 in or not. The chance of BoS having a market leading rate again seems pretty slim.

polymaff

talexuser wrote: »

But the 5K I had in Vantage (earlier 3 Vantages at 3%) was at 2%, lately 1.5%, now[STRIKE] 1%[/STRIKE], so that was worth it too, while the monthly was ahead. I agree £8 a year is not worth the time of setting up a standing order, or keeping the Vantage either with £1 in or not. The chance of BoS having a market leading rate again seems pretty slim.

Yes, but for most, I suspect, it isn't an either-or circumstance. £5k at 1.5% was better than other instant access accounts and the BoS regular saver was a nice offering too. Now that the instant access account £5k is 1.2%, which can be beaten by Marcus - but the BoS RS is better still, so the pecking order is, worst-to-best, BoS bank account, Marcus, BoS RS.


And so, providing you have the funds, you'd logically clip their interest-earning capability in that order.

polymaff

By the way, everyone, look on the bright side. Using the 13-payment forced funding you can achieve with LBG regular savers, you can push up the effective interest achieved between the two accounts.


By between 0 and 4p in the pound...:)