Saga scraps red tape to win back savers
STOP SHORT CHANGING SAVERS
SAVERS aged 50 and over can now earn a top 1.4 pc with Saga.
Over-50s specialists Saga teamed up with investment bank Goldman Sachs to challenge High Street names. Its new Saga Easy Access Savings Account pledges to pay a consistently competitive rate without enforcing any complicated rules.
Saga is now writing to around one million savers who have money in its old accounts paying just 0.2 pc to inform them of the new deal. Savers can open an account with as little as £1 online or over the phone and earn 1.4 pc on deposits up to £100,000.
The rate includes a 0.25 percentage point bonus for the first year — but Saga promises to alert savers when this is due to run out. There are also no withdrawal restrictions.
This is a victory for our Stop Short-changing Savers campaign, which calls for fairer rates and simpler accounts. Last month we revealed easy-access accounts are too complicated, with 13 of the top 30 deals restricting when customers can access cash.
It is also good news the account is available over the phone, as many top rates are now reserved for those willing to run their accounts online. With big High Street banks paying a pittance it means savers who do not use the internet are increasingly reliant on phone or postal accounts.
Britain’s biggest building society Nationwide, for example, pays just 0.1 pc on balances up to £10,000 and 0.25 pc if you have £50,000+ in its Instant Access Saver.
Halifax Everyday Saver and Web Saver, and Lloyds Bank Easy Saver, Standard Saver, Online Saver and Internet Saver pay only 0.2 pc. Barclays Everyday Saver offers 0.25 pc, or 0.3 pc if you have £50,000 or more in the account. NatWest Instant Saver starts at 0.2 pc up to £25,000, rising to just 0.3 pc up to £1 million
And you earn only 0.35 pc with Santander Everyday Saver and an even worse 0.15 pc with HSBC Flexible Saver. The Marcus account from Goldman Sachs pays 1.45 pc.
The new Saga account is only open to those aged 50 or over and can be run as an individual or joint account. You can also attach a power of attorney document to it so a loved one can look after your money if you are unable to manage it in the future.
Echoing the demands behind Money Mail’s campaign, Jeff Bromage, managing director at Saga Personal Finance, says: ‘We have listened to our customers and this is what they want — a consistently good rate, decent service and an account which is simple to understand.’
Saga’s one-year fixed-rate bond, at 1.15 pc, is far higher than major High Street accounts, too. Halifax and Lloyds pay just 0.55 pc for two years, while Barclays and NatWest pay 0.65 pc for one year.
Any money in the Saga account is covered up to £85,000 — £170,000 on joint accounts — under the Financial Services Compensation Scheme. This applies to the total of any deposits with Goldman Sachs International Bank under any brand, including savings you may have with its Marcus account.
If you have savings in old Saga accounts opened before September 28 this year, your money is still with Birmingham Midshires and covered under the FSCS by the Bank of Scotland licence.