Has anyone noticed that all the best savings deals are online only? I cast my eye over the top 20 offers on Moneyfacts the other day and found only three of them (all from the same bank, Axis) had any access other than electronic. Axis does offer branch access too, well done to them, but they only have one branch and it’s in London.
This is important because rates offered by online accounts are much higher than those available on the high street. The top deal on Moneyfacts yesterday was a five-year fix at 2.51% from Vanquis Bank. In comparison, Nationwide has only 1.85% for a similar length of time.
If you’re a technical whizz, this won’t present a problem. If you’re part of the ‘unline’ community, however, perhaps being elderly or disabled, you’re at a great disadvantage. It's especially unfair if you’re living on a fixed income and need to make your available cash work as hard as it possibly can.
Team Minted had this problem recently. Grandpa can Google and email quite happily but he doesn’t want to entrust his life savings to the internet. When his fixed-term account with Nationwide came to an end, we couldn’t find a decent home for the money. All online deals were out and even Sainsbury’s phone bank was deemed too complicated with having to speak to robots and remember passwords. Eventually we trailed back to Nationwide and accepted their rather average rate for passbook access.
It’s worth saying that with inflation currently running at 3%, Grandpa would lose money in real terms in both the Vanquis and Nationwide accounts. He would do better in shares but, like many older people, he is more interested in preserving his money than making long-term investments.
Normally I try to provide a solution for anyone in a similar circumstance in my blogs. In this case, I can’t find one. My Skinted colleague Charlotte has suggested seeking out local building societies which sometimes have better rates or offer special deals to local customers. However, not every town has one. If anyone has any ideas about how to solve this particular problem, let us know in the comments below!
You can ask questions like this in our Skinted Minted forum here.