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Three of Britain’s biggest building societies will increase the interest rates on a number of savings deals, following last month’s Bank of England base rate rise.

Newcastle, Skipton and Yorkshire Building Societies, which between them have roughly 4million members, have announced that rates will head upwards as of 1 February.

However, all three are only upping interest rates for some of their savers – namely those on variable deals.

Only savers on variable rates stand to benefit and in most cases the full 0.15 per cent base rate rise won't be passed on.

Only savers on variable rates stand to benefit and in most cases the full 0.15 per cent base rate rise won’t be passed on.

Furthermore, only Newcastle Building Society claim to be passing on the 0.15 per cent rise in full.

The rate rises will all take effect from 1 February – almost seven weeks after the Bank of England lifted the base rate from 0.1 per cent to 0.25 per cent.

Yorkshire Building Society, home to almost three million members, will be hiking its variable rates by 0.1 per cent from 1 February.

This means its best paying easy-access deal will rise from 0.4 per cent to 0.5 per cent, whilst its best paying easy access cash Isa deal will increase from 0.35 per cent to 0.45 per cent.

Chris Irwin, director of savings at Yorkshire Building Society, said: ‘It has been a tough few years for savers so we’re delighted to be able to increase our savings products at the same time as protecting our borrowers from the increase.

‘With no external shareholders to satisfy we have protected savers as far as possible during the extended period of a record low Bank Rate, maintaining an average interest rate on our accounts which has been consistently higher than the market average.

‘Our decision today to increase our variable rate accounts continues to reflect our mutual ethos of putting our members first.’

Skipton Building Society, which has over 1million members, has also decided to up its variable rates in light of the base rate change and claims that over half a million customers are getting rate increases as a result.

It states that the average rate rise is 0.12 per cent for members whose rates are increasing and its average variable rate after these changes will be 0.40 per cent.

Most notably, Skipton’s Triple Access Saver will rise from 0.61 per cent to 0.7 per cent.

As it stands that will make it the best paying easy-access deal on the market – albeit limiting savers to three withdrawals a year.

Similarly, Newcastle Building Society, which has more than 300,000 members, says it will apply the full rate rise to the majority of its variable rate savings products.

It claims that 97 per cent of members with a variable rate savings product will benefit from a rate increase of 0.15 per cent.

This includes its easy-access saver which is currently paying 0.15 per cent on deposits up to £250,000. As of 1 February, this account will pay 0.3 per cent.

However, two of its highest paying variable rate savings products will remain unaffected by the changes, after it confirmed its Triple Access Saver and Monthly Access Saver products won’t be subject to a rate change at this time.

What about the other big names?

Given their focus on customers, it was expected that all these member-owned organisations might score an advantage over their banking rivals by immediately pushing up savings rates in the wake of last month’s increase in the base rate.

Yet, whilst three are now doing so, Nationwide, Coventry, Leeds and Principality Building Society are all yet to make any changes.

Nationwide, Britain’s largest building mutual by a considerable distance with more than 16million members is remaining tight lipped on the matter.

A spokesperson said: ‘We are still working through what the bank rate increase means for savers and will announce any changes in the near future.’

Nationwide’s easy-access deal, Flex Instant Saver, pays 0.35 per cent whilst its one-year triple access saver currently pays 0.45 per cent.

Britain's biggest Building Society, Nationwide is yet to increase savings rates in light of the base rate rise.

Britain’s biggest Building Society, Nationwide is yet to increase savings rates in light of the base rate rise.

Principality, home to more than 500,000 members was similarly non-committal on the question of when it will boost rates.

Morgan Miles head of products and pricing at Principality Building Society said: ‘We have been taking time to understand what the Bank Of England interest rate change means for our members and our products, and we’ll share an update with more information to our members in the next few weeks.’

Principality’s online limited access deal, which allows customers to withdraw money up to three times a year, pays 0.55 per cent whilst its easy access deal pays 0.25 per cent.

Leeds Building Society, home to roughly 750,000 members, also says it is still ‘reviewing the impact’ of the base rate rise.

A spokesperson said: ‘As a building society, it’s important for us to balance the needs of savers and borrowers, and we’ve worked hard in this low interest rate environment to offer long-term value to both.

‘The majority of Leeds Building Society savers and borrowers are on fixed rate products. Therefore, their rates will remain the same until their fixed periods end.’

To give Leeds some credit, it is currently offering one of the more generous online easy-access accounts paying 0.6 per cent, which features in our best best buy tables.

In terms of deals offered in-branch, it currently pays 0.15 per cent to its easy-access savers and 0.5 per cent for its Double Access Saver which allows savers to make withdrawals twice a year. 

BRANCH-BASED ACCOUNTS – INSTANT ACCESS 
Type of account (min investment) 0% tax 20% tax 40% tax
Accounts WITHOUT bonus – These rates are not boosted by a temporary bonus that drops off after a year      
Newbury BS welcome to Newbury (£50+) (1) 0.75  0.60  0.45 
Skipton BS Triple Access 3 (£5,000+) (4) 0.61  0.49  0.37 
Coventry BS Limited Access Saver 4 (£1+)(3)  0.50  0.40  0.30 
Leeds BS Double Access Saver (£1,000+) (2)  0.50  0.40  0.30 
Swansea BS Instant Access Saver (£1+)  0.50  0.40  0.30 
(1) Only available in Newbury and surrounding areas
(2) You hare limited to making two withdrawals a year. If you make more withdrawals you lose 30 days’ interest on the money withdrawn  
(3) You are limited to making six withdrawals a year   
(4) You are limited to making three withdrawals a year   

Coventry Building Society similarly has no plan to increase rates in light of the base rate rise.

A spokesperson said: ‘In 2021 we paid our savers more on average than the rest of the market.

‘Maintaining higher savings rates when others cut them back to almost nothing shows our commitment to savers over the long term.’

Coventry’s Limited Access Saver, which allows for customers to withdraw up to four times each year, currently pays 0.5 per cent, whilst its easy-access saver, without restrictions, pays 0.3 per cent. 

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.

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JEFF PRESTRIDGE: Inflation in a low interest rate environment is a financial nightmare for cash savers, so banks must help them out










Inflation in a low interest rate environment is a financial nightmare for cash savers. Like a mouse with cheese, inflation – now running at 5.4 per cent – nibbles away at the real value of saving, undermining the savings ethic and hitting the risk averse elderly the hardest. 

There’s little most hardened savers can do to counter this financial pest other than chase the best interest rates. Even then they’re not going to find any bank or building society prepared to pay anything near 5.4 per cent. 

Some braver souls – including many readers I speak to – have taken more decisive action, turning some of their cash savings into income-producing investments. It’s an understandable response, albeit one not without risk. 

Shrinking: Like a mouse with cheese, inflation – now running at 5.4 per cent – nibbles away at the real value of saving

Shrinking: Like a mouse with cheese, inflation – now running at 5.4 per cent – nibbles away at the real value of saving

What makes the situation worse for many entrenched cash savers is that a majority of those banks and building societies who look after their money don’t seem to care about their financial wellbeing – even when they have the perfect opportunity to give savers a little more. Disgraceful.

It is now five weeks since the Bank of England base rate was tickled up by 0.15 percentage points to 0.25 per cent. Five weeks in which savings account providers have had the opportunity to give customers a little more by way of interest. But the overall response has been lamentable, despite our decision last month to heap pressure on them by launching our Give Savers A Rate Rise campaign. 

Our stance is simple, fair and not particularly demanding: savers in variable rate accounts – especially easy access products where rates are notoriously parsimonious – should get the full benefit of the 0.15 percentage point rise. Bar a few notable exceptions, banks and building societies have refused to play ball. Profit making has been the order of the day with many savers enduring a version of Chinese water torture. 

Building societies Newcastle and Yorkshire both broke ranks last week – so hats off to them. Newcastle, the country’s eighth largest society, said that 97 per cent of members with a variable rate account would see their rate increase by 0.15 percentage points from the start of next month. It means rates on instant access accounts such as Easy Saver (Issue 3) and Easy Saver Isa will double to 0.3 per cent. 

Yorkshire is being less generous, stating it would add 0.1 percentage point of interest – not 0.15 – to a ‘majority’ of accounts where the savings rate is variable. Like Newcastle, the higher rates will kick in on February 1. Unlike it, Yorkshire has yet to identify which minority of accounts will not get the 0.1 percentage point rise. 

In Yorkshire’s defence, it does offer superior rates to many of its competitors, though it is wrong that its easy access cash Isa (Internet Saver Isa Plus Issue 9) pays an inferior rate to that offered on the equivalent non-Isa Internet Saver Plus Issue 9. It’s an anomaly that many readers have pointed out. 

As for big providers of savings accounts, the word procrastination should be embedded into their brands. On Friday, in response to enquiries about when they would be pushing up rates, delay and evasion were to the fore. 

Nationwide Procrastination Building Society said: ‘As you know, we are still working through what the base rate increase means for savers and will announce any changes in the near future.’

‘No update re [savings] rates,’ said NatWest Procrastination Bank. Lloyds was a little more forthcoming, stating it was still ‘reviewing’ what the change meant for variable rate savings customers (little in terms of more interest, I imagine). But it did confirm any changes would come into effect on February 1. 

HSBC said its savings accounts were not directly linked to the base rate – blatantly obvious if you put the piddling rate it pays on Flexible Saver (0.01 per cent) up against 0.15 per cent.

It added: ‘If there are any changes to interest rates, we will notify customers directly.’ Santander said nothing enlightening. 

Stop procrastinating and give savers a rate rise. 

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Savers navigating ‘pensions minefield’ need help to make better decisions, MPs warn










Savers are in a ‘pensions minefield’ and need help to make better decisions, MPs warn.

The Work and Pensions Committee says Government and regulators must ‘end their timidity’ to assist savers, some of whom are ending up as victims of pensions scams.

They also want automatic appointments with Pension Wise to be trialled. It offers those aged 50 and over free, impartial guidance.

The Work and Pensions Committee says Government and regulators must 'end their timidity' to help savers avoid making poor decisions and in some cases falling victim to pensions scams

The Work and Pensions Committee says Government and regulators must ‘end their timidity’ to help savers avoid making poor decisions and in some cases falling victim to pensions scams

The pension freedoms of 2015, gave people a much wider range of choices over what to do with their pot than buying an annuity.

Yet the Financial Conduct Authority told the MPs consumers judged pensions a ‘minefield’. Many struggled to understand how they work.

Committee chairman Stephen Timms, says: ‘The pension freedoms, far from living up to their name, will instead trap people in an increasingly confusing web of complexity.’

b.wilkinson@dailymail.co.uk

TOP SIPPS FOR DIY PENSION INVESTORS

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Too many savers are confused by pensions and at risk of scams, and need more help in the run-up to retirement, say MPs.

They call on the Government to ‘end their timidity’ and trial automatic appointments with free guidance service Pension Wise, claiming current plans to ‘nudge’ people into it will not be enough.

MPs also suggest investigating the ‘decoupling’ of the 25 per cent tax-free lump sum from the rest of a pension pot – potentially allowing people to take that cash and leave the other 75 per cent in their work schemes for longer.

Retirement plans: Too many savers are confused by pensions and at risk of scams, say MPs

 Retirement plans: Too many savers are confused by pensions and at risk of scams, say MPs

Pension freedoms that let people access their entire retirement savings at 55 have been a success on balance, but many ‘struggle to navigate the pensions minefield’, according to the influential work and pensions committee.

‘The Government and regulators can no longer just sit on their hands as decision making becomes ever more complicated,’ says chair Stephen Timms MP,

‘Without intervention to drive up dramatically the numbers receiving advice and guidance, savers will make poor decisions – and, in far too many cases, become scam victims.’

In a previous report last summer, the committee of MPs slammed the Government for defying widespread calls to crack down on financial scam adverts in the forthcoming Online Safety Bill.

During the past week, it has been rumoured the Government could U-turn and include paid-for ads in the legislation after all. 

Meanwhile, the Department for Work and Pensions yesterday confirmed plans to give people in occupational pensions – those run by trustees on behalf of employers – a ‘stronger nudge’ towards taking up appointments with Pension Wise.

The Financial Conduct Authority oversees a similar nudge system for work schemes that are run by outside pension firms for employers.  

The regulator has previously estimated that one in seven people accessing a pension for the first time use Pension Wise.

What is Pension Wise? 

Over-50s can book a free appointment to discuss their pension pots and retirement plans with the Government-backed service here. 

Staff will offer guidance on the options available, but for detailed personal advice you should consider paying for financial advice.

Meanwhile, a separate official behavioural study found 11 per cent of people who received a ‘nudge’ attended an appointment, compared to 3 per cent who did not.

The latest report from MPs cited an estimate from a pension firm that after savers have spoken to Pension Wise, just 14 per cent of pension pots are then accessed.

This could be because while savers often feel pressure to use pension freedoms, the best course of action is often to do nothing with their retirement pot immediately.

>>> Should YOU tap your pension? 10 questions to ask yourself first. 

‘Automatic appointments with the Pension Wise service should be trialled as part of a renewed commitment from the Government to support people to make better decisions in retirement,’ say MPs today

‘The committee’s report recommends the Government sets a goal of at least 60 per cent of people to be using the government guidance service Pension Wise from the Money and Pensions Service or receiving paid for advice when accessing their pension pots for the first time.’

The MPs’ report also explored the issue of decoupling the 25 per cent per cent of a pension which is tax free from the rest of the pot.

‘This is one of the most well-known UK pension policies and leads to many people who access their pensions for the first time taking poor decisions about the remaining 75 per cent,’ says the report.

‘We heard persuasive arguments both for and against. The best way to assess these arguments is through further research and testing. We recommend that regulators should carry out a scoping exercise.’

But MPs were sceptical about the possible introduction of an annual awareness-raising pension statement ‘season’.

‘The committee is not convinced that the gains from a pension statement season, where schemes are required to send out annual statements, justify the complexity of introducing it,’ they say.

‘The Government must be prepared to adapt or drop its proposals if the benefits cannot be demonstrated.’

Timms says: ‘From the introduction of auto-enrolment through to the continued shift from defined benefit to defined contribution schemes, the pensions landscape is in a constant state of change.

‘It’s little wonder therefore that — as the Government’s own financial regulator recognises — people struggle to navigate the pensions minefield.

‘When the 2015 reforms were introduced the Government guaranteed that savers would be given the tools they needed to take advantage of the new range of options and make well-informed decisions.

‘Seven years on, guidance remains the missing piece of the pension freedoms jigsaw. Nudging savers will not be enough.

‘They must end their timidity and be much more active in supporting people as they approach retirement. We know that those who use Pension Wise find it useful and often make different choices as a result. Every effort should be made to boost its use.’

A DWP spokesperson says: ‘We are committed to ensuring people have the support and information they need to make informed choices about their financial futures, striking the right balance between providing vital protections and informing pension savers, while also giving them freedom and choice about how to use their hard-earned pension savings.

‘Our stronger nudge measures will require pension scheme trustees to offer to book a Pension Wise appointment for a saver, unless they actively decide to opt out of receiving guidance through a separate communication. 

‘Since November, our new transfer regulations have bolstered protections for savers by empowering trustees and scheme managers to halt a transfer request where they suspect it could end up in the hands of a fraudster.’

TOP SIPPS FOR DIY PENSION INVESTORS

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.

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JEFF PRESTRIDGE: Leading savings expert says the way banks are treating their savers with paltry rates rises in response to base rate hikes is ‘awful’










Awful. That was the reaction from a leading savings expert after Barclays Bank broke ranks last week and finally pushed up some – not all – of its savings rates in response to last month’s hike in Bank base rate to 0.25 per cent. 

The ‘awful’ came from the mouth of Anna Bowes who, for her sins, spends her working life poring over savings rates as co-founder of rate scrutineer Savings Champion.

As Anna readily admits, it’s not a particularly enlightening occupation at the moment given the reluctance of most banks and building societies to pay savers anything other than a pittance. Anna says ‘awful’ a lot these days – and understandably so. 

Cash strapped: Savers are receiving poor returns from the hard-earned cash they have in savings accounts

Cash strapped: Savers are receiving poor returns from the hard-earned cash they have in savings accounts

The word wasn’t muttered because Barclays had broken ranks – that was commendable – but for the parsimony of its belated reaction to the 0.15 percentage point rise in base rate that was announced a month ago on December 16.

The bank, which made profits of £2billion in the third quarter of last year (up from £1.1billion over the same period in 2020), said it had increased the rate on its Instant Cash Isa from between 0.02 per cent and 0.05 per cent to between 0.05 and 0.1 per cent.

For savers with less than £30,000 in the account, it will mean a paltry 0.03 percentage point increase in the tax-free interest they receive. An extra £3 in annual interest for every £10,000 of savings, a fiver instead of two pound coins. For those with £30,000 of savings, they will now receive annual interest of £30 compared to £15 previously.

If Barclays had passed on the full 0.15 percentage point increase in base rate – as we have been demanding as part of our Give Savers A Rate Rise campaign – the equivalent interest payments would be £17 and £60. Hardly income sums to rejoice about but not as awful as what has prevailed. 

Barclays told me last week that it remained committed to providing customers with ‘a range of options to help them save for their goals,’ singling out in particular its children’s savings account (paying 1.5 per cent) and its Help to Buy Isa (1.25 per cent). What it omitted to say is that 1.5 per cent is only paid on balances up to £10,000. Above that ceiling, additional balances attract 0.01 per cent. 

What it also failed to mention is that its instant access account Everyday Saver continues to pay 0.01 per cent interest on balances up to £10million. 

In other words, £1,000 of annual interest on £10million of savings. We wait to see what it will do for these savers in the coming days. But one thing’s for sure. It won’t be much. 

Towns and villages need essential community services  

Community lies at the heart of a lot of the issues we cover in The Mail on Sunday’s personal finance pages. Although acknowledging the digital world we live in, we believe that our towns and villages should be vibrant places where essential community services – for example, a bank, post office, library and pub – are available. 

For example, it’s why we have long been flag wavers for community-style banks – bank branches run by a third party, typically the Post Office, which all customers of the major high street banks can use. 

Community is also an ethos embodied in everything that the 1,700 Rotary clubs in Great Britain and Ireland do. Comprising some 40,000 members, drawn from all walks of life, these clubs strive to improve their local communities. They do it voluntarily and regularly raise bucket-loads of money for local charities. 

Last Thursday night, I had the privilege to speak at a dinner organised by Reading Abbey Rotary, a club comprising some 40 spirited individuals. 

And it was indeed a privilege as I told them about our editorial focus on community while learning about the good work they do in Reading and its local environs. They support food banks and raise funds through the organisation of events such as 10-kilometre runs around local estates (it’s how I first got to know of the club’s existence). 

Rotarians are a force for local good. If you fancy becoming one, visit rotarygbi.org. 

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Surging inflation means the outlook for savers hunting returns is bleaker than bleak. Not one savings account is currently able to keep anywhere near the pace of rising costs.

People can be forgiven for losing interest and whether there is a point of tucking money away for interest paying in some circumstances 5 per cent below the rate of inflation – and this gap could grow bigger in the coming months.

However, firstly for those without a savings pot whatsoever, it is important to have a rainy day fund to fall back on.

Meanwhile, those who have savings stashed away earning a pittance, 2022 might be the year to try and make the money work harder.  

Some apps can help you stick to your savings goals by analysing your income and spending habits and automatically putting money aside so that you don't have to make the decision

Some apps can help you stick to your savings goals by analysing your income and spending habits and automatically putting money aside so that you don’t have to make the decision

There are a host of money management apps and websites specifically designed to simplify the process and for novices, the importance of getting started.

They won’t necessarily help savers secure the best deal on the market – although some will – but they can at least get people into the habit of saving.

Some savings apps can help you automatically save by rounding up your spare change when you spend on your bank card.

Some apps calculate how much you can afford to put aside and squirrel it away automatically, while others allow you to set yourself quirky savings challenges.

They can also help to simplify the savings process and remove the form filling and time sacrifice you might otherwise experience were you to move from provider to provider on the open market.

We went on the hunt for the niftiest savings apps and websites based on what they do and return on offer.

Best for returns: Raisin

What is it?

Raisin can help to simplify the savings experience and cut the bureaucracy involved with setting up new savings accounts.

As a savings platform and app, Raisin allows savers to effectively manage all of their savings in one place.

It means that through a single online account, you can open multiple savings accounts with numerous different banks as and when you require without the usual form filling and admin.

The Savings platform Raisin is currently offering a £50 welcome bonus to savers who sign up and deposit £10,000 or more

The Savings platform Raisin is currently offering a £50 welcome bonus to savers who sign up and deposit £10,000 or more

What return can I expect?

Raisin’s welcome bonus gives savers the chance to boost their savings by £50 when they open and fund an account on its marketplace with a minimum of £10,000 – although it’s worth noting that the bonus only applies to one’s first savings account with the platform.

Given that its current range of deals sit very competitively with the rest of the market, Raisin offers savers a chance to effectively leapfrog the best savings rates via its £50 bonus when depositing their first £10,000 using the platform.

For example, Raisin’s best easy access deal – offered by the private bank, Brown Shipley is paying 0.61 per cent, not far off Shawbrook Bank’s market leading 0.67 per cent rate.

Add the £50 welcome bonus and it means anyone saving £10,000 into this account via the Raisin platform, can effectively secure a rate of 1.11 per cent for the first year – a return of £111.

Raisin also has a one year fixed rate deal, via Investec paying 1.33 per cent, again not far off the 1.41 per cent being paid by the market leader Gatehouse bank.

Add the £50 welcome bonus and a saver depositing £10,000 will effectively receive a 1.84 per cent rate or £184 return.

Is it safe?

All of Raisin’s partner banks are fully regulated in the UK and in the event that Raisin ceases trading, your deposits, would be protected by the FSCS up to £85,000 per person, per banking group, or up to a similar amount through the equivalent European deposit guarantee scheme.

Any money left sitting in your Raisin UK Account is also protected by the FSCS up to £85,000 as your Raisin UK Account is managed by Starling Bank, a fully regulated UK bank.

If Raisin UK ceases trading, then your funds would remain safe with the partner bank you originally deposited them with.

Verdict

When it comes to maximising returns, Raisin is probably the pick of the bunch compared to rivals.

It currently offers savers a choice of 72 savings deals from across 20 providers, comprising fixed rates bonds, easy access accounts and notice accounts.

It’s also free to use unlike a number of the other savings platforms so there isn’t a monthly charge to worry about.

However, like some of the other digital savings apps, it does not use any advanced machine learning to automatically help you save.

For a saver who wants full manual control over what and when they put into their savings while having all of their cash in one place with minimal form filling, Raisin is a good bet. 

Savings accounts

Best for AI: Chip

What is it?

Chip is an automatic savings and investment app designed with the intention of helping its customers to save and invest without having to even think about it.

Chip uses artificial intelligence technology linked to your bank account via open banking to calculate how much its customers can afford to save based on their spending habits.

It then transfers that money from their current account to their Chip account – automatically whilst not interfering with a person’s normal day-to-day spending habits.

Customers can increase or decrease the amount Chip puts aside by tweaking their saving level on the app, which determines how fast or slow they want to save.

Chip can apparently adapt to a person overspending or earning irregular income and can adjust the savings amounts accordingly.

It offers a host of features – it analyses your spending habits, helps set savings goals, and can automatically set a regular amount to save every time you get paid by your employer. 

What’s the return?

Chip recently launched a new easy access account, powered by Allica Bank, offering a market leading 0.7 per cent.

More than 400,000 people have downloaded Chip.

More than 400,000 people have downloaded Chip.

Savers can deposit up to £85,000 into any Chip savings account, including the Allica account, although the Allica account is not yet set up to accommodate the auto saving feature.

It also works with the savings platform Flagstone to negotiate access to savings accounts with competitive interest rates.

Flagstone’s services are normally only available to those who are able to deposit £50,000 or more, but Chip is enabling those with smaller deposits to also benefit.

Money you put into an Allica Easy Access or Flagstone accounts are held in a ‘segregated client trust account’ with other Chip savers’ money.

By pooling all Chip savers’ money it claims it can negotiate better interest rates for its savers from the banks.

Is it safe?

All Chip’s savings accounts are powered by UK authorised banks and therefore the money you deposit is covered by the Financial Services Compensation Scheme, up to £85,000 per person, per bank.

Its default account in the app is powered by ClearBank and is also FSCS eligible.

Savings calculator

Work out how a lump sum or regular monthly savings would grow

Verdict

Currently to open the Allica account, customers need to have a paid-for subscription which costs a minimum of £1.50 per month, which will eat into the savings rate.

This means, for example, someone saving £10,000 via the Chip AI account would see their £70 return drop to £52 over a year – effectively rendering the rate 0.52 per cent.

However, from mid-January, Chip will move to a simplified fee structure with two membership plans; ‘Chip’ which is free and ‘ChipX’ which will cost £3 every 28 days.

Savers on both plans will be able to save between £1 and £85,000 into any of the accounts, including the Allica account offering 0.7 per cent.

They will also be able to auto-save into that account, regardless of the plan they’re on.

The premium ‘ChipX’ membership won’t be necessary for those just focusing on saving, however, for those willing to dip their toe into investing, it will include a range of investment funds, including ethical and clean energy funds and an emerging markets fund.

Once the fee structure is simplified the free Allica powered easy access account could be a great option for savers who will not only benefit from a top rate, but all Chip’s AI that could get them in a great savings habit without having to think about it.

Best round-up app: Moneybox

What is it?

Moneybox is an app that allows savers to round up their everyday bank card purchases to the nearest pound and set aside the spare change into a savings account.

Similar to Chip it uses open banking to link to your bank account and means savers can get into the habit of saving every time they spend without having to actively set aside money.

Savers can also deposit money into their account on a weekly or monthly basis and even give themselves a monthly boost when payday arrives.

The round-ups feature will likely be particularly attractive to those who are struggling to get into a savings habit.

How much you save will depend how many transactions you make, but according to Moneybox, its customers are making around 30 transactions per week with an average round up of about 28p each time, resulting in £8.41 savings per week from round ups alone.

It’s worth noting that roundups are not live deductions taken each time you spend, but are pooled over the course of the week and debited from your bank account in one go.

If you’d prefer not to use round ups, you can still make payments by setting up a weekly deposit or making one-off deposits.

Moneybox claims to have been downloaded by more than 700,000 people.

Moneybox claims to have been downloaded by more than 700,000 people.

What’s the return?

Moneybox’s easy access saver pays 0.47 per cent, which is 0.24 per cent less than Shawbrook Bank’s 0.67 per cent deal on the open market.

It does however, allow you to open an account with as little as £1 and deposit up to £85,000.

It allows for one withdrawal per month which means access is more restricted than some other easy access accounts.

It also offers a 45 day notice account paying 0.55 per cent, a 90 day notice account paying 0.6 per cent and a 120 day notice account paying 0.8 per cent – none of which are as high as the best paying deal on the open market.

Is it safe?

This savings account is powered by its partner bank’s Shawbrook, Charter Savings Bank and Investec.

All three are covered by the Financial Services Compensation Scheme so your total eligible savings are protected up to £85,000.

Verdict

There are no fees for holding any of its three savings accounts.

The only catch is that you will not be earning as much interest as you might otherwise make on the open market.

However, for those looking to feel a little less guilty every time they spend, this could be a great option.

Best for money management: Plum

What is it?

Similar to Chip, Plum connects to your current account and analyses your incomings and outgoings.

It analyses transactions and then identifies your regular income, rent, bills and daily spend.

Using this and other factors like your available balance it calculates daily what amount it can safely put aside without impacting your daily life and moves it to your Plum account via direct debit every four to five days.

It also offers a round-up feature much like Moneybox so you can save spare change without any effort.

You can create your own savings buckets based on your personal goals whether that be a holiday or a house, for example.

Plum is then able to adapt to help you automatically save to meet those goals.

It also allows you to choose your own auto-saving rules or you can pick a mood to save based on how you’re feeling.

For example, if you’re feeling ambitious, you can expect Plum to start saving 50 per cent more than usual, or if you’re feeling shy, then you can expect 50 per cent less savings than usual.

Plum's smart algorithm analyses your spending and helps you save without even thinking about it.

Plum’s smart algorithm analyses your spending and helps you save without even thinking about it.

What’s the return?

Its best easy access deal pays 0.4 per cent, but it is only available to those with a fee paying Plum account.

 Plum has four account options for customers. Basic, which is free, Plus which is £1 per month, Pro which is £2.99 per month and Ultra costing £4.99 per month.

Those with a free basic account can only secure an easy access deal paying 0.25 per cent.

Given the best easy access deal on the market currently pays 0.71 per cent – this is a major sacrifice. 

You can get a real-time view of your daily and monthly spending.

You can get a real-time view of your daily and monthly spending.

Is it safe?

When Plum sets money aside for you, it’s moved from your bank account and held in an e-money account, which is held and administered by a partner, which is regulated to hold your money as an ‘Authorised Electronic Money provider’.

This e-money account is not FSCS protected, but is subject to strict European regulation, meaning that in the unlikely event that Plum or the partner should go bust, you will get your money back.

Verdict

Although its Basic Plum account is free and this includes automatic savings and round-ups, savers will only be able to secure 0.25 per cent on their savings which is not far off three times worse than the best paying easy access deal on the open market.

Those who wish to have access to the higher paying 0.4 per cent deal will have to sign up to the Plum Plus account which costs £1 each month.

The app is one of the simplest to use, but the returns on offer may make Plum less appealing than some of its competitors.

The other money management apps are out there

Claro is a ‘financial coaching’ app which enables its users to have one-on-one sessions with financial expert to discuss their goals and plans for the future.

The first financial coaching session is free once you download the app. Thereafter you pay between £60-£80 an hour, depending on your needs.

Using the app you can connect your bank accounts via Open Banking and therefore allow you to see your spending and income from all your bank accounts in one place.  

Claro says its coaches will work with you to create a plan to make your goals a reality no matter what financial stage you are at.

Claro says its coaches will work with you to create a plan to make your goals a reality no matter what financial stage you are at.

It is also offering savers a deal paying 2 per cent – they don’t have to pay for coaching to benefit either.

However, it may not appeal to those looking to stash away large amounts as the 2 per cent deal is capped at £3,000. 

The Claro account is Financial Services Compensation Scheme protected for individual balances up to £85,000, with savers’ money held in a pooled NatWest account.

Good for: 

  • Affordable financial advice
  • 2 per cent bonus rate on deposits up to £3,000
  • Seeing all your bank accounts in one place 

Yolt is a venture of Dutch bank ING Bank N.V. meaning it has the stability of a well-established bank but also the agility of a future forward fintech.

It is a licensed third party provider, is regulated by the Dutch Financial Authorities and can be found on the FCA register.

Good for:

  • Seeing your spending history via charts 
  • ‘Splitting the bill’ between accounts
  • Earning rewards from various retailers
  • Comparing utility and insurance providers

Emma, described as ‘your best financial friend’, is a free app designed to help you avoid overdrafts, cancel wasteful subscriptions, track debt and save money.

It also allows you to see all your accounts in one place, including your current accounts, savings, cryptocurrencies and even pensions

Emma analyses your transactions to give you the full list of recurring payments across your accounts enabling you to better track and cancel wasteful subscriptions.

Emma analyses your transactions to give you the full list of recurring payments across your accounts enabling you to better track and cancel wasteful subscriptions.

It is registered with both the FCA and the Information Commissioner’s Office and uses several state-of-the-art security measures, so you can rest assured your data is safe.

Good for:

  • Helping track and cancel wasteful subscriptions
  • Syncing your budget to payday
  • Comprehensive analysis and budgeting   

Money Dashboard was voted Best Personal Finance App in both 2020 and 2021 and is one of the more popular apps available, with half a million users.

It allows you to set up multiple budgets and send notifications if you overspend, while also allowing you the ability to predict any future spending.

Good for:

  • Seeing your total balance across all your accounts
  • Transferring money between all your bank accounts in one app
  • Personalising how your spending is grouped and organised
  • It notifies you when your balance is looking low and bills are still due
  • You can review how your spending habits have changed over time

Cleo is very much targeted towards the younger generation, with a fast-paced quirky nature and the opportunity to win cash via quizzes and games.

Cleo is different from most of its competitors in that it uses AI to talk to you like a real person. 

You can ask the app questions and it will respond as if you’re texting a friend making the user experience a bit more fun and lively.

It is free to use, FCA-registered and it has also signed a pledge which provides protection for up to £85,000 in losses to UK bank accounts and credit cards where the losses are attributable to sign-up and use of Cleo.

Moneyhub brings together all your bank accounts, credit cards, investments, savings and borrowing under one umbrella.

Moneyhub brings together all your bank accounts, credit cards, investments, savings and borrowing under one umbrella.

Good for:

  • Making money management fun and interesting
  • Setting saving goals with Cleo via Round-ups
  • Also savers can pick a number and just let Cleo automatically save for you
  • Informative and engaging blog posts
  • Get spending updates, budgeting tips and help with bills

Moneyhub is another one of the leaders in this area, having been around since 2009.

It intuitively categorises your transactions, whilst its spending analysis shows you exactly where your money goes each month.

It is FCA registered and is one of the few money management apps that is available for businesses as well as for personal use. 

Good for: 

  • All your accounts, investments, assets and borrowing in one place
  • Insights into your spending habits and tools to help you change your behaviour
  • Keeping you informed with relevant and timely ‘nudges’ 
  • Spending analysis and spending goals
  • Explaining jargon   

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