Charter Savings Bank

Daliah

Parking your cash in Premium Bonds whilst you decide what you want to do would certainly be an option.

Your money will lose purchasing power in any savings account, as the interest rates of none of them come even close to the current and expected inflation rate. 

To come up with potentially better suggestions, you'd need to provide more information, such as:

What are your plans for the money?
How old are you?
What are your pension provisions?

ashteadgirl

jbuchanangb said:

Have has a 95 day notice account with Charter for 5 years without any problems. It is still paying 0.7%. Just opened an 18 month bond at 1.35%. No adverse comments. Have not been able to  discover whether it is possible to cancel a requested withdrawal within the notice period when circumstances changed.

Yes in their notice savings accoutns you can give notice on some/ or all or the money and cancel the notice easily online upto day before it is due to happen. Very easy system to use and give you flexibility by having portions of the account on rolling notice so you can cancel notice if funds not required.

AskAsk

andyhicks88 said:

Thanks for all your replies, it seems they are a solid bank to hold savings with.  Is it the best option though? This is my first time really getting serious about saving so are there better, but still very simple, options of saving my pot of around 40,000?  What about premium bonds? How would sticking it all in there measure up to what I was planning on doing with Charter? Which was splitting it about 20/80 between their easy access and 1 yr fix?

i have 50k in the premium bonds since August 2020 and i have been recording the monthly winnings as a running yield and i am getting 0.71% return.  there is no tax to pay on premium bond winnings so you can gross this up using your tax margin.

grossed up for me at 40% tax rate, i am getting an equivalent gross running yield of 1.19% so it is underperforming when compared to a fixed year savings account.  i am normally quite a lucky person so a bit disappointed with the return but i am hoping to get bigger prizes one day as the most i have had in any month is £75.

the best fixed savings account rate is with al rayan, the shariah bank.  i have had a fixed savings account with them for a few years now and they are fine.  always got paid the interest even though that is estimated and not guaranteed because of the shariah principle of money lending.

refluxer

andyhicks88 said:

Thanks for all your replies, it seems they are a solid bank to hold savings with.  Is it the best option though? This is my first time really getting serious about saving so are there better, but still very simple, options of saving my pot of around 40,000?  What about premium bonds? How would sticking it all in there measure up to what I was planning on doing with Charter? Which was splitting it about 20/80 between their easy access and 1 yr fix?

Premium Bonds have to be held for a whole calendar month before they qualify for a draw, so any bought today wouldn't qualify until the January 2022 draw. If you're wanting to maximise returns from your money then it makes sense to buy them closer to the end of the month than the start, presuming that the money is currently in an account earning interest that is ! If you bought PBs today, that would be almost 2 months that the money could be earning interest in the savings accounts you mentioned.

It's obviously hard to 'do the sums' when it comes to comparing PBs with savings accounts where the interest rates are known, but my instinct (as a PB holder since 2013) would be that you would see a slightly higher return from your money with the 80/20 split in the Chartered Savings accounts you mentioned, particularly if you take into account that you would only get 11 qualifying PB draws in the same time period (Jan to Nov 2022). This is presuming you have what they call 'average luck' on the PBs (where you would hope to get around a 0.9% return over time) and obviously doesn't take into account the potential or result of a 'big win'. If you have above-average luck, then you might do better in PBs.

One big advantage to Premium Bonds over a Fixed Rate account is that your money is fairly easily accessible and also (for some) that the prizes are tax-free and don't count towards your Personal Allowance for interest earnings.

You can get slightly higher rates than Charter currently offer with their Easy Access and Fixed Rate accounts, but you would have to consider using two different companies in order to get those better rates. That said, I see from the MSE top tables that if you put more than £10k in a 1 Year Fixed Rate with Charter via Raisin at the moment then new Raisin customers get a £50 bonus which I think, for the 80% (£32k) you're talking about, would make Charter the best option currently available for a 1 Year Fixed rate. I've never used Raisin personally though, so can't comment on them as a company.