Money expert Martin Lewis is urging anyone who earns less than 4% in their savings accounts to ‘do better’ and switch up to a more lucrative account paying out more interest.
The Bank of England this week opted to hold interest rates at 4%, rather than cutting or raising them.In a tight decision, five of the nine-strong committee of rate-setters voted in favour of maintaining the interest rate. It came despite the Bank indicating that inflation has now “peaked” and that unemployment is likely to rise beyond previous expectations.
With rates held at 4%, money expert Martin Lewis explained how several products currently available to savers can beat that threshold.
Martin Lewis tweeted to his millions of followers about a savings focused special episode of his BBC Sounds and Spotify podcast: “If you’re earning less than 4% in your savings, you can do better! This pod shows you how to maximise every penny both simple ways and more complex too if you’re spend more time.”
Speaking on the episode, Martin said: “The top payers at the moment, two pay 4.5%. So that’s what you want to be looking at. If you’re earning less with easy access, get your money out of there and put it into one of these.
“You’ve got Ulster Bank which is part of NatWest so it’s a big name, pays 4.5%, you need a minimum of £5,000.
“…The rate will drop in a year but for the next year you should have a decent rate. Because all easy access accounts are variable.
“There’s also Chase. Chase, part of JP Morgan, pays 4.5% on a minimum of £1, again includes a 2.25% bonus.
“If you just want a bog standard simple you don’t have to be new, there’s no minimum, Hodge Bank, 4.2%, minimum £1, maximum £250,000, which is way more than most people will have to put in, take your money out whenever you want, no other caveats with that one.”
Martin said that the alternative is fixing, lock your money away at a guaranteed rate for a given number of years, which tend to have better rates, but you cannot access the money.
He added that Monument currently gives 4.47% for one year, and LHV bank 4.46%, both higher than any of the easy access accounts, and they can’t be reduced within that timeframe.