July’s savings round-up

The latest news to help you get the most from your savings account.

Here’s my monthly update sharing changes at leading UK savings accounts, as well as some of the articles you might have missed on the blog.

July’s savings update video

July savings news

Green Bonds are coming

Back in the Budget in March, the Chancellor announced some new ‘Green Bonds’ for savers to launch later in 2021. Well, we now have some further information – but not the most vital part… the interest rate.

Without knowing how much you’ll gain from the savings bond it’s hard to say whether they’ll be worth it, but we do know how they’ll work.

First, they will be fixed for three years, and you won’t be able to access your cash in that time. You’ll be able to invest between £100 and £100,000 in total, and you can open one as long as you are over 16. The full launch date is “later this year”.

There’s also more detail about how the money will be used. As the name suggests it’ll go towards the government’s “green projects”, though we won’t know which ones for around two years. The key areas are provided though. These are:

  • Making transport cleaner
  • Renewable energy
  • Preventing pollution
  • Using energy in a more efficient way
  • Protecting natural resources
  • Adapting to changing climate

As soon as there’s an announcement of the rate I’ll share it here on the blog, along with my thoughts. If you don’t want to wait until then, you can still choose green and ethical savings accounts. I’ve listed the best ones here.

Inflation hits 2.1%

There’s been yet another big jump in the inflation rate. The latest figures (for May 2021) put it at 2.1% – up from 1.5% the previous month, and 0.7% before that.

This high rate means that it’s impossible to beat inflation on any decent sums of money at the moment, and this could carry on for a while. But it doesn’t mean it’s any less important to get the highest rate you can.

More small rate increases

The Bank of England base rate remained at 0.1% for another month, but we’ve seen another month of tiny, tiny increases to fixed-rate and easy access accounts.

There are more easy access accounts offering 0.5%, including Marcus (more on this below for existing customers), so this is the least anyone should be getting on their savings. However there are still better options for most people.

The largest increases have been on fixes, with locking away your cash for 12 months now potentially earning you 1.1%.

Existing Marcus customers need to add a 0.1% bonus

Marcus has added on a 0.1% bonus for new and existing customers bringing the rate to 0.5%. It’s automatic for new savers, but existing customers will need to manually add this.

To do this, you need to log into your online account – it won’t work on the new Marcus app. Click view next to your account details and then on the bottom left of the screen you’ll see an option to ‘Review your savings’. This will open a page with a button to ‘Renew your bonus’. Click this. My video above also shows you how to do this step-by-step.

Where to put your savings in July 2021

Make sure you check for updates in my regularly updated savings best buy article, but right now I’d look at the following:

Best places to save £1,000

Amount savedAccountRateNotes
Up to £1,000Virgin Money M Plus current account2.02%Can only earn interest on the first £1,000 saved

Best places to save £3,000

Amount savedAccountRateNotes
£1,000Virgin Money M Plus current account2.02%Can only earn interest on the first £1,000 saved
Up to £2,000Chip +1 (ChipLite plan)1.25%To earn interest on savings above £2,000 there’s a fee

Best places to save £3,001 to £6,000

Amount savedAccountRateNotes
£1,000Virgin Money M Plus current account2.02%Can only earn interest on the first £1,000 saved
£2,000Chip +1 (ChipLite plan)1.25%To earn interest on savings above £2,000 there’s a fee
Up to £3,000Club Lloyds current account0.6%Two direct debits are required to get the interest on balances up to £5,000

You’ll also get a choice of free cinema tickets or movie rentals.

Best places to save £6,001 to £11,000

Amount savedAccountRateNotes
£1,000Virgin Money M Plus current account2.02%Can only earn interest on the first £1,000 saved
£5,000 to £10,000Chip +1 (ChipAI plan)1.25%You’ll pay a £1.50 fee every 28 days which reduced the real rate from the advertised 1.25% (full table here)

Best places to save £11,001 to £16,000

Amount savedAccountRateNotes
£1,000Virgin Money M Plus current account2.02%Can only earn interest on the first £1,000 saved
£10,000Chip +1 (ChipAI plan)1.25%You’ll pay a £1.50 fee every 28 days which reduced the real rate from the advertised 1.25% (full table here)
Up to £5,000Club Lloyds current account0.6% to 1.5%Two direct debits are required to get the interest on balances up to £5,000

You’ll also get a choice of free cinema tickets or movie rentals.

Best places to save more than £16,000

Amount savedAccountRateNotes
£1,000Virgin Money M Plus current account2.02%Can only earn interest on the first £1,000 saved
£10,000Chip +1 (ChipAI plan)1.25%You’ll pay a £1.50 fee every 28 days which reduced the real rate from the advertised 1.25% (full table here)
Between £5,000 and £50,000Premium bonds1%*Once you have £5,000 in Premium Bonds it should win more than the best easy-access account (currently 0.5%)

Once you’ve got at least £10,000 in Premium Bonds your average win rate will probably be better than the Club Lloyds account
* prize rate, not interest rate

Andy’s podcast

Listen to Cash Chats, Andy’s twice-weekly podcast. Episodes every Tuesday and Friday.

3 thoughts on “July’s savings round-up

  1. Used to have c£18k with Chip. In the early days I had their 5% interest rate and all was grand. Bit by bit over the last two years they have “chipped” away at the returns they offer. Sure they have opened up various new accounts but they want you to jump through hoops, keep recruiting friends, or pay fees. I was earning nothing on my investment, so at the end of May I withdrew the lot. I invested £30k in Premium Bonds and in July, the first month it was eligible, I won £25, which has automatically been reinvested in more Bonds. I can get my money at any time, with no penalties and I’ve already had more interest in one month than I had from Chip in a long time. Roll, on next month… Even if I don’t win a prize I’ve found it’s actually quite enjoyable checking!

  2. Hello. I have banking with Lloyds Bank and basic Savings account interest rate is 0.01% but I have that new Savings account with Royal Bank of Scotland and the new Current Account plus Savings account with TSB but I am thinking of moving all of my savings into a Co-operative Bank current account then but it into a online saving account with Co-op Bank then put into the online Cash Isa with Co-op Bank can you look into it for me please yes or no. Thank You! From Richard Gorton.

    1. Just a quick look at the rates for savings with Co-op bank and they’re all pretty poor. I’d go with one of the other accounts listed here https://becleverwithyourcash.com/cash-savings-beat-inflation/

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