Martin Lewis advises on savings accounts and premium bonds
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As it stands, the country’s inflation rate is at 10.1 percent and is expected to surpass 13 percent by the end of the year. Furthermore, analysis conducted by Citigroup estimates that it will continue to skyrocket to 18.6 percent later next year. In response to this, Nationwide is one of the many building societies that has hiked its interest rates to support peoples’ savings at this time.
Specifically, the building society has raised the rate on its One Year Triple Access Online Saver to 1.75 percent AER/gross per annum (variable) for 12 months.
On top of this Nationwide has hiked the interest rate on its on-sale One Year Triple Access Online ISA to 1.50 percent gross/tax-free per annum (variable) for 12 months.
While none of these rates surpass inflation, both give saves three withdrawals during a 12-month term and are available from September 1, 2022.
It should be noted that any subsequent cash withdrawals will see the interest rate revert to 0.25 percent for the remainder of the account’s tenure.
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Among the other savings accounts by Nationwide which have seen their rates raised include:
- The Loyalty Saver, Loyalty ISA and Loyalty Single Access ISA accounts are going up from 0.35 percent to 1.60 percent gross/AER.
- The Flex Instant Saver are being raised from 0.50 percent to one percent AER
- Instant access accounts, including Instant Access Saver, Instant ISA Saver and Cashbuilder will jump by up to 0.15 percent to either 0.25, 0.30 or 0.35 percent
Tom Riley, the director of Banking and Savings at Nationwide Building Society, explained why the incision has chosen to boost peoples’ savings at a time of high inflation.
Mr Riley said: “We appreciate it isn’t easy for people to save at the moment with the rising cost of living, but having money set aside that you can use for unexpected expenses can provide real peace of mind.
“As a mutual we are always keen to support savers and pay the best rates we can sustainably afford, which is why we are increasing rates on all variable rate accounts, particularly regular savers, loyalty and children’s accounts as well as our popular Triple Access accounts.
“These changes are the latest increases that the society has made to its savings accounts over the last few months.”
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Steven Cameron, the pensions director at Aegon, warned that the soaring inflation rate is leading to a “decrease” in the interest rates of various savings products.
Mr Cameron said: “Our research shows many are already taking action to cut costs by reducing day-to-day expenditure and cancelling unnecessary commitments.
“But worryingly, the research also points to a decrease in saving rates. While this may be unavoidable, it could have long-term implications on financial resilience.
“And when it comes to your pension, reducing or stopping contributions could mean missing out on employer contributions and having thousands less in funds to get by on in retirement.”
The finance expert shared advice on how people can boost their savings and finances while inflation continues to rise.
He added: “There are a number of ways to get help with financial concerns and it’s important for individuals to make use of these in order to build their financial wellbeing.
“The Government offers free guidance via a number of online services such as MoneyHelper and financial services providers may also offer support and tools to help with your financial worries. A financial adviser can provide more personalised advice.
“While support services can’t always solve a shortage of ‘money’, they can improve people’s mindset by giving them some comfort that they’re taking the best steps they can in often very difficult circumstances.”
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