NS&I to cut premium bond rate and other accounts

moneysavinghero

According to the BBC:

As government spending increased to fund the response to the coronavirus crisis, so did the amount that NS&I was asked to raise for the government. In July, its target was increased from £6bn to £35bn

I guess someone has to pay for all the furloughed people that have been paid to ride their bikes round all day for the last 6 months, and it looks like NS&I savers are the ones to pay it.

where_are_we

crumpet_man said:

Not sure about online access but if you can spare £1 then open the Direct Saver account, leave £1 in it and be confident your online access will remain.

wiseonesomeofthetime said:

@where_are_we - Closed both of mine today and will be shifting it to Skipton BS as soon as it arrives in my current account.

See little point in hanging around for two months.

Thanks people! Tomorrow I will be closing my income bond account, sticking £1 in Direct Saver and moving the rest into Skipton Bonus Saver Issue 7.

kinger101

moneysavinghero said:

According to the BBC:

As government spending increased to fund the response to the coronavirus crisis, so did the amount that NS&I was asked to raise for the government. In July, its target was increased from £6bn to £35bn

I guess someone has to pay for all the furloughed people that have been paid to ride their bikes round all day for the last 6 months, and it looks like NS&I savers are the ones to pay it.

Given the cost of COVID to the UK Government is likely to be hundreds of billion pounds, the interest rate would need to be minus several hundred percent if NS&I savers were being the ones to pay. 

The reality is taxpayer is subsidising saving slightly less.

thegentleway

kinger101 said:

thegentleway said:

nbrewitt said:

Sailtheworld said:

It's about time. Not sure why the taxpayer was expected to be providing market leading interest rates to the already wealthy.

Irresponsible comment, not all NS&I savers would class themselves as wealthy by any means 

Sorry but I think you are grossly underestimating what is means to be weathly by world standards. Please note that

Nearly Half the World Lives on Less than $5.50 a Day

This value is adjusted to reflects standards in upper-middle-income countries. So yeah, if you are an NS&I saver then you are very wealthy.
Check out: https://howrichami.givingwhatwecan.org/how-rich-am-i if you want to find out how rich you are compared to the rest of the world.

Erm.......
(1) you can have £1 in an NS&I saver account.  

(2) median household income is about USD 10,000.  Hard to square that with USD 5.50 a day
https://news.gallup.com/poll/166211/worldwide-median-household-income-000.aspx

(3) income is relative to where you live.  

(1) 39% of the population don’t even have a bank account let alone a savings account.
(2) you’re confusing individuals and households.

(3) that’s why the figure I posted is adjusted from $3.20

ffacoffipawb

moneysavinghero said:

According to the BBC:

As government spending increased to fund the response to the coronavirus crisis, so did the amount that NS&I was asked to raise for the government. In July, its target was increased from £6bn to £35bn

I guess someone has to pay for all the furloughed people that have been paid to ride their bikes round all day for the last 6 months, and it looks like NS&I savers are the ones to pay it.

Be nteresting to see how they can achieve £35bn with these rates. I have just sent my Income Bonds balance (bar £500) and Direct Saver balance (bar £1) to my bank today so I can reinvest with Hargreaves Lansdown Active Savings - still dire but the best of a bad set of rates.

At 0.01% you need £10m on deposit to exceed the personal savings allowance.

EthicsGradient

For those talking about the Skipton "Bonus Saver": it's not in their list of "all savings accounts":  https://www.skipton.co.uk/savings/compare-all-savings-rates
and a Google search for Skipton Online Bonus Saver turned up this link: https://www.skipton.co.uk/savings/easy-access/online-bonus-saver
but that goes to the list of other accounts, with "Sorry, this product is no longer available - Please take a look at all our available products below." at the top.
Ah, I see - if you managed to open one last week, before it was withdrawn after two and a half days: https://www.theguardian.com/money/2020/sep/18/skipton-best-buy-savings-account-sells-out-in-three-days

Nick_C

I think you'll find most people talking about Skipton at 1.2% opened the account last week when it was available. I certainly did. 

lhsecons

veryintrigued said:

Whilst it's not great news isn't it just one more occasion that we've all had to shuffle our money from account to account?

Apart from the ever diminishing returns this is no different.

I would argue that this is substantially different for 2 reasons,
Firstly the rates haven’t just been cut, they’ve been decimated. NS&I are effectively saying that , beyond premium bonds, they don’t want anybody to save with them.
Secondly, they have been the top payer for a considerable time and have seen massive inflows. Whoever replaces them at the top will be inundated very quickly so a race to the bottom will be accelerated.

Thrugelmir

ffacoffipawb said:

moneysavinghero said:

According to the BBC:

As government spending increased to fund the response to the coronavirus crisis, so did the amount that NS&I was asked to raise for the government. In July, its target was increased from £6bn to £35bn

I guess someone has to pay for all the furloughed people that have been paid to ride their bikes round all day for the last 6 months, and it looks like NS&I savers are the ones to pay it.

Be nteresting to see how they can achieve £35bn with these rates.

Premium bonds? Ideal home for short term deposits. 

hoc

This isn't just a cut, it's a strong message. Wow.