If you have money in a savings account or a cash ISA, make sure you’ve checked them so you’re not earning rock bottom rates of 0.1% or less.
Who’s paying the least?
Savings rates change all the time, but the regulator the Financial Conduct Authority (FCA), published a an updated list of banks and building societies paying the lowest interest rates on savings accounts and cash ISAs. It did this the first time in December, and has updated its list today (July 18th).
It’s not named the specific accounts, but I’ve done some digging and have come up with a list of lowest paying savings accounts you can operate in a bank branch, the lowest paying savings accounts that are online, phone or operated by post and I’ve done the same for cash ISAs (in branch and online/by phone/by post). All the accounts I’ve highlighted below are ‘open’ accounts, which means you can still open them (not that you’d probably want to!).
SAVVY TIP: If you have money saved in these accounts, some of the rates are appalling no matter how much you’ve saved and some pay relatively decent rates if you have a lot saved, but paltry rates on lower amounts. So it’s not necessarily the case that you must move your money just because you have an account I’ve mentioned below.
Easy access savings accounts – branch based
What I’ve noticed is that there are far more accounts that pay a pitifully low rate of interest, and that are based in a branch, compared to ones you can operate online. I’ve included the names of all accounts that pay 0.1% interest or less based on the FCA list. I’ve also included links to all the accounts so you can check if these are accounts you have.
The Post Office has an Instant Saver account that pays no interest at all if you have less than £500 in it. On balances above £500 you earn 0.8% interest. You have to have at least £500 to open the account, but if your balance were to fall below that figure, you wouldn’t get a penny in interest.
Danske Bank The Northern Ireland based bank has Summit Savings Account which pays just 0.01% interest no matter how much or how little you’ve saved in it. That means you’d earn just 1p interest a year if you had £10,000 in the account.
Ulster Bank This bank is part of the NatWest/RBS Group and its Easy Access Savings Account pays 0.01% interest no matter how much you have in the account. It might be easy access, but it’s virtually interest free.
First Trust Bank You can earn up to 0.05% interest if you deposit up to £99,999 into First Trust Bank’s so-called Select Account. Blimey! Not sure why you’d want to.
HSBC The bank’s Flexible Saver Account pays 0.05% no matter how much or how little you have in the account, although it pays 0.1% if you’re an HSBC Advance or Advance Graduate customer.
Cambridge Building Society This building society’s Instant Access Account pays 0.1% interest on amounts between £100 and £9,999. There’s a higher rate of interest (0.25%) if you have more than this.
Clydesdale Bank Its Instant Savings Account pays just 0.1% interest no matter how little or how much you’ve saved.
One Savings Bank This bank covers a number of banking brands, including the Kent Reliance, which is its UK trading name. Its branch only Easy Access Savings Account pays 0.1% interest on balances up to £999, although it jumps to a respectable 1% if you have £1,000 or more.
Principality Savings Account This building society pays just 0.1% interest on its Instant Access Account, no matter how much you save (and you can save up to £1 million in this account(!).
Santander pays just 0.1% interest on its Instant Saver, which takes deposits from £1 up to £2 million.
Yorkshire Bank pays 0.1% interest on its Instant Savings Account.
Easy access savings accounts: online, phone or post
Here are the lowest paying accounts that can be managed online, by phone and/or by post, based on the FCA’s list.
First Direct Savings Account – this account pays just 0.05% no matter how much or how little you save. You can see the interest rates on all First Direct’s savings accounts on its website.
Danske Bank in Northern Ireland has what it calls a Savings Account Plus (not quite sure what the plus stands for!). It pays 0.05% interest no matter how little or how much you save.
HSBC has three savings accounts paying 0.1% in interest. There’s the Premier Savings account which is available to Premier bank account customers who can enjoy a ‘preferential’ rate of interest of 0.1%, the Flexible Saver, which pays 0.05% if you’re an HSBC bank customer or 0.1% if you’re an HSBC Advance or Advance Graduate customer.
There’s also the Online Bonus Saver which pays you 0.5% unless you make a withdrawal in a month. If you do make a withdrawal, it only pays you 0.1% in that month. You can find all the interest rates for HSBC’s savings accounts on its website.
One Savings Bank This bank covers a number of banking brands, including the Kent Reliance, which is its UK trading name. It has an Easy Access Account that pays just 0.1% interest on balances up to £999.
Bank of Scotland has an Access Saver which pays 0.5% interest, but that includes a bonus rate of 0.3%, so you only earn 0.2% if you leave your money there after 12 months.
Easy access cash ISAs – branch based
If you opened an easy access cash ISA and you can access it in a branch, you could be earning as little as 0.1% in interest. Time to move your money elsewhere!
SAVVY TIP: You can find out what you need to do to transfer a cash ISA in my video called How to transfer a cash ISA
Santander You’ll only earn 0.1% interest on money you have in its Easy Cash ISA up to £26,999. If you have £27,000 – £39,999 you earn 0.3% interest and if you have more than £40,000 you earn 0.5%.
TSB You earn 0.2% on TSB’s Cash ISA, although there’s a bonus of 0.55% for the first 12 months. After that the rate goes down to 0.2%.
First Trust Bank pays 0.25% on balances up to £4,999 on its Cash ISA. Interest rates are tiered and you can earn 1.35% on amounts over £50,000, but a lot less if you don’t have much saved.
NatWest You earn 0.25% interest in NatWest’s Cash ISA if you have less than £25,000 in it. If you have between £25,000 and £50,000 you earn 0.5% interest.
Danske Bank pays 0.4% interest on its Cash ISA if you have less than £30,000 in it, but pays 1.6% on amounts of £30,000 and over.
Royal Bank of Scotland You earn 0.5% interest in RBS’s Cash ISA if you have less than £50,000 in it. If you have over £50,000 you earn 1% interest.
Co-op Bank You earn 0.5% interest on its Cash ISA no matter how much money you have in it.
Ulster Bank You earn 0.5% interest in Ulster Bank’s Cash ISA if you have less than £50,000 in it. If you have over £50,000 you earn 1%interest.
West Bromwich Building Society pays 0.5% interest on its Easy Saver ISA on amounts up to £4,999. You can earn 1% on amounts between £15,000 and £500,000 (after August 3rd – the rate is currently 1.25%).
Bank of Scotland You can earn 0.6% in interest on its Access Cash ISA, but only for the first 12 months. After that the rate drops to 0.5%.
Easy access cash ISAs – not branch based
The interest rates on non-branch based cash ISAs weren’t as low as they were on branch based accounts, so I’ve included all the cash ISAs on the FCA’s list that pay less than 1% interest.
Sainsbury’s Bank Cash ISA pays 0.5% interest on balances up to £499, although you can earn 1.2% on balances over £500.
West Bromwich Building Society has an Easy Save ISA, which pays interest at 0.5% on balances from £1 to £4,999.
Co-op Bank Online Cash ISA pays 0.65% interest no matter how little or how much you have in it.
Tesco Bank Instant Access Cash ISA pays 0.75% interest on balances over £1.
Santander Direct ISA saver pays 0.8% interest unless you’re a Santander 123 current account customer, when it pays 1%.
What to do now
If you have savings accounts you’ve not checked for a while, here are my tips:
- If you have money in these accounts, move it to a bank or building society paying more interest.
- Use the savings site Savingschampion or price comparison sites such as Moneysupermarket, Moneyfacts, uSwitch, Gocompare or the Moneysavingexpert website to find the best rates. I normally compare rates from at least two price comparison sites.
- I’ve only listed open accounts, where you can still take the account out. But if you have money in a closed account – one that’s no longer being marketed – you could be earning even less interest. The Post Office and First Direct are currently paying 0% interest on one of their closed accounts.
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