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.
March’s savings update video
March’s savings news
Interest rates sneak up, but well below inflation
This month there have been a handful of increases on the back of February’s Bank of England base rate increase, though most of these haven’t passed on the full 0.25%. For example, NS&I moved rates from 0.35% to 0.5%, still far below the top easy access account paying 0.75% (more on getting 1% below).
And despite this, your savings are still losing out compared to inflation. The latest figures (for January) show inflation has hit 5.5%, and it’s now expected to go past 7% this spring.
Virgin Money offers 1%
Virgin Money’s M Plus Current Account has been leading the pack on savings for the last year and a bit with 2.02% on balances up to £1,000, boosted to 5.02% for bank switchers.
Now, that’s getting better, with the linked savings account (The M Saver) increasing it’s rate to 1% from 1 March 2022. This rate is only on the first £25,000 saved.
Here’s my full analysis, including what it means for those with Premium Bonds.
Zopa launches “Smart Saver” account
This new account from Zopa is an interesting approach to savings. You get a standard easy-access rate of 0.72% (near the top of the charts – for now), but you can decide to “boost” your rate in separate notice accounts.
- 7 days notice earns 0.75%
- 31 days notice earns 0.85%
- 95 days notice earns 1.05%
The idea is if you lock portions of your cash away you can’t impulse spend it, which I think is a decent feature. You are limited to only £15,000 in the account, but that should be enough for most users.
However, though the rates on each option are decent compared to most of the competition, they’re significantly less than the new Virgin Money rates.
Green Bonds rate doubled
The NS&I Green Bond, launched last year with a pitiful 0.65% return for a three-year fix now offers 1.3%.- but only for new accounts. Those who have already opened one will be stuck with the lower rate.
But even if anyone is keen to try out the bonds at the new rate, my initial review of the account still stands. Instead I’d suggest looking elsewhere for green-ish returns. For example, a one-year fix with building society Kent Reliance pays 1.32% and the Sharia-compliant bank Gatehouse will give a rate of 1.31% right now.
Nationwide closes Start to Save account
Nationwide’s 24 month Start to Save regular saver / prize draw accounts have now been closed to new customers, and prize draws finished for those who still hold one. My account just hit its 24 month anniversary and the money was moved to a “Continue to Save” account paying 0.5%.
If your account is still live, you’ll be getting 1.25%, which you can beat in Nationwide’s own Flex Regular Saver paying 2.5%. And if it has matured then make sure you move it to a better paying option.
Raisin’s welcome bonus drops to £30
From 1 March 2022, the bonus new Raisin customers can get for saving £10,000 for six months will drop to £30 from the current £50. Details of the offer here.
Claro app has brief downtime
I received an email today from Claro saying they were having delays with the app due to a “surge in new users”. I had a quick look and, yep, the app was down. A few hours later I checked again and all was working fine.
Though Claro offers 2% on £3,000, it’s no good if you can’t get it. I’d hope this was a one-off, and the same could happen to any bank – but it’s a good reminder not to have all your money in one place.
Masthaven to close all savings accounts
If you have any savings (or even a mortgage or loan) with Masthaven, you’ll probably already know that the bank plans to leave the UK market in the next two years.
It’s probably worth shopping around now and transferring your cash to a different bank if it’s not in a fixed rate account. If it is locked away, keep checking to see whether the bank will close before the term is up.
Where to put your savings in March 2022
Make sure you check for updates in my regularly updated savings best buy article, and of course you might have existing accounts closed to new customers with better rates.
Of course you can fix your money for better rates, or if you’re happy to have your money in lots of different places you can mix and match the options. But if you’re looking for relative simplicity right now I’d look at the following easy access accounts:
Best places to save up to £29,000
The best option for the first £1k is Virgin Money as it is truely easy access. The next £3k is with the Claro app, but this is just for Apple devices. If you’re on Android then skip to the next section with the Virgin Money and Club Lloyds accounts.
This combination gets you the highest interest rates and some extra freebies.
|£1,000||Virgin Money M Plus current account||2.02% (5.02% if switch to Virgin)||Can only earn interest on the first £1,000 saved (additional joint acount is allowed)|
|£3,000||Claro app||2%||Only via Claro app|
|Up to £25,000||Virgin Money M Saver||1%||Must have Virgin Current account|
Best places to save more than £29,000
So you’ve filled up Virgin and possibly Claro too? As long as you can lock £10,000 away for at least six months then the £50 bonus from Raisin (£30 from 1 March 2022) is worth grabbing and you’ll still get 1%.
Or you could look at Premium Bonds. The most you can save here is £50,000, though you should aim for at least £10,000 to beat other easy access accounts (assuming they pay 0.75%).
|£10,000||QIB via Raisin 95 days notice||1%||If you’re new to Raisin and put in £10,000 for at least six months you’ll get a £50 bonus on top (£30 from 1 March 2022).|
|Up to £50,000||Premium bonds||1%*||Once you’ve got at least £10,000 in Premium Bonds your average win rate will probably be better than the best east access|
Listen to Cash Chats, Andy’s twice-weekly podcast. Episodes every Tuesday and Friday.