Rubbish savings rates

dosh37

I don't remember a time when savings interest rates were actually below the BoE interest rate.

Why is this happening?

t1redmonkey

Probably years and years of quantitative easing and money being printed non stop, to the point where hardly any banks actually need saver's cash so they're not feeling the need to up their rates.

Band7

plenty of savings rates above BoE rate https://moneyfacts.co.uk/savings-accounts/

dosh37

That's what I thought. So no point in saving.

I'm off to buy beer and shag hookers before I get too old.

dosh37

Band7 said:

plenty of savings rates above BoE rate https://moneyfacts.co.uk/savings-accounts/

yes, but only if you tie into a fixed rate when interest rates are set to increase.

RG2015

dosh37 said:

I don't remember a time when savings interest rates were actually below the BoE interest rate.

Why is this happening?

It may sound simple, but the banks and building societies don't want to give away too much when they have enough funding for their plans.

That said, First Direct are offering a 7% account which the highest rate seen for several years. And this is not the only one as the list below shows.

First Direct RS 7%
Club Lloyds RS 5.25%
NatWest/RBS RS 5%

Barclays Rainy Day instant RS 5%

Virgin Money instant flexible ISA 3%

dosh37

RG2015 said:

dosh37 said:

I don't remember a time when savings interest rates were actually below the BoE interest rate.

Why is this happening?

It may sound simple, but the banks and building societies don't want to give away too much when they have enough funding for their plans.

That said, First Direct are offering a 7% account which the highest rate seen for several years. And this is not the only one as the list below shows.

First Direct RS 7%
Club Lloyds RS 5.25%
NatWest/RBS RS 5%

Barclays Rainy Day instant RS 5%

Virgin Money instant flexible ISA 3%

And what is the maxiumum amount you can invest in these high interest accounts?

dosh37

These are regular saver accounts and are not comparable.

RG2015

dosh37 said:

RG2015 said:

dosh37 said:

I don't remember a time when savings interest rates were actually below the BoE interest rate.

Why is this happening?

It may sound simple, but the banks and building societies don't want to give away too much when they have enough funding for their plans.

That said, First Direct are offering a 7% account which the highest rate seen for several years. And this is not the only one as the list below shows.

First Direct RS 7%
Club Lloyds RS 5.25%
NatWest/RBS RS 5%

Barclays Rainy Day instant RS 5%

Virgin Money instant flexible ISA 3%

And what is the maxiumum amount you can invest in these high interest accounts?

I am guessing that is a rhetoric question and I take your point, but banking is a business like any other.

They want to make money not give it away. Without being too coarse, they don't give a stuff about customers and even less about the BoE base rate,

If they need more money they look to the cheapest option, be it customers or the Bank of England. As to the BoE rate hikes, the commercial banks have factored in all of these rate rises ages ago.

Their aim is financial as opposed to the BoE which is political, purely based on the narrow goal of 2% inflation.

Band7

dosh37 said:

Band7 said:

plenty of savings rates above BoE rate https://moneyfacts.co.uk/savings-accounts/

yes, but only if you tie into a fixed rate when interest rates are set to increase.

There are several 3%+ without tie-in. HSBC OBS, Barclays Rainy Day, Aldermore and Monmouthshire are the ones that spring to mind. Though you may have missed some of them as they aren't available for long.

Many of the RSs are in effect instant access. I have currently over £12k in 14 4.5%+ accounts, only 3 of which cannot be accessed before maturity. The total amount I can pay into these accounts over the next 10-12 months is nearly £45k - more than enough for my instant access needs.These RSs get drip fed from 2.81% accounts, so I easily get more than BoE rates. All this before adding in fixed term accounts, all of which are 4%+.

I appreciate that it takes regular attention to the interest rate movements but it's really easy to check the best rates, either yourself, or by piggybacking on the efforts of other MSE forumites.

RG2015

dosh37 said:

Band7 said:

plenty of savings rates above BoE rate https://moneyfacts.co.uk/savings-accounts/

yes, but only if you tie into a fixed rate when interest rates are set to increase.

Are they?

And that is the point. Nobody knows.

The best indicator is the bond rate as was clearly evident after Kwasi Kwarteng's own goal.