Hospitality: Interest rates to rise further to match inflation
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Attempting to help savers get to a “great place” for Christmas 2022, this account can be opened from £1. Interest is paid annually, paying one percent gross per annum/AER variable.
The rate of interest can change – meaning it could move either up or down.
As it’s a regular saver, there are limits as to how much can be deposited into the account.
Up to £300 can be put into this savings option each month for 12 months – working out at £3,600 over the course of the year.
The building society’s savings interest calculator shows a person who puts in the maximum monthly deposit amount each time could gain £19.52 in interest.
There is a limit in terms of access – withdrawal is limited to one day per year, based on the anniversary of the account opening.
If required, it’s possible to close the account even if the saver has used their withdrawal day.
On its website, Yorkshire Building Society says: “Start saving today and you could be in a great place for Christmas 2022.”
The account can be applied for online, in branch or agency, or by post.
Only one account can be opened per person.
This account currently pays the highest rate of interest offered by Yorkshire Building Society, correct at the time of writing.
So, how does it compare to other regular savings accounts?
There are a range of regular savings accounts paying one percent AER, a comparison by Moneyfacts shows.
Topping Moneyfacts’ list of best rates on regular savings accounts is the Learner Earner (Issue 3) from Principality BS, paying 2.35 percent gross/AER variable.
Currently, there are four providers offering a two percent AER interest rate via a regular savings account.
These are from Nationwide Building Society, Newcastle Building Society, TSB, and West Bromwich Building Society.
The Bank of England’s Monetary Policy Committee (MPC) last month announced the increase of the Base Rate from 0.1 to 0.25 percent.
Outside of this change, savers with their cash in a flexible account would perhaps have noticed it’s been a “very volatile” year of interest rate changes, Rachel Springall, Finance Expert at Moneyfacts.co.uk, said.
She said that despite interest rates falling to record lows on average, the market had been showing “green shoots of recovery”.
Ms Springall continued: “This base rate change may take a few months to trickle down to savers who have a variable rate deal, but there is also no guarantee the rate will be passed onto them in full, or at all.
“Should savers see 0.15 percent passed onto them, it would mean receiving £30 more a year in interest based on a £20,000 investment.
“It remains the case that savers need to act swiftly to take advantage of the best deals and, as some easy access accounts pay as little as 0.01 percent, hopefully this base rate rise will shake any saver’s apathy to look elsewhere.
“The biggest high street banks are unlikely to be matching base rate on their easy access accounts, so savers would be wise to reconsider their loyalty.”
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