| | | - Santander 123 rate cut, others under review, but top accounts aplenty
- Ignore the myths. Switching's easy, 75%+ of MSE users say so
- New. Check YOUR bank's service and dump the dummies
The fallout from this month's base rate cut is hitting home. As MSE revealed on Sunday, Santander will slash the headline rate for its 3m+ 123 current accounts from 3% to 1.5% in Nov (see Martin's Should I ditch 123? analysis). Then came the aftershocks, as Lloyds and Halifax told us ALL their current accounts are "under review".  Yet you can still make easy money switching bank - which itself is hassle-free. Some providers pay big cash bribes and have market-leading fixed savings to protect you from rate cuts. Because of the rapidly changing market we've checked with all providers below and unless stated they've no changes planned.
| | | | 1. | Free up to £150, 6% fixed savings - protected from rate cuts. The beauty of cash bribes and fixed savings is once the accounts are opened and the bank switch completed these are locked in. This is regardless of base rate cuts or banks just dropping benefits at their whim - and that security is crucial in these turbulent times. However, any additional perks can still change. Here are the headlines:
- Free £150 + up to £5.50/mth: Co-op Bank* pays switchers £150 (need to switch 4+ active direct debits), plus sign up to its Everyday Rewards scheme and jump through a few hoops to get up to £5.50/mth. No min pay-in for the £150 but it's £800/mth for the extras.
- Free £100 + no.1 service + 6% FIXED savings: First Direct* pays a £100 bonus to switchers. It also has a £250 0% overdraft and linked 6% regular savings on £25-£300/mth fixed for a year. Min pay-in: £1,000/mth (£10/mth fee otherwise).
- Free £100 M&S gift card + 6% FIXED savings + £10/mth: Switch to M&S Bank and get a £100 M&S gift card, £100 0% overdraft and 6% linked regular savings on £25-£250/mth fixed for a year. No min pay-in, but for each month you deposit £1,000 in the first year, it adds a £10 gift card.
- Free £100 + £5/mth for now. WARNING - under review: Halifax Reward gives switchers £100, plus £5/mth if you stay in credit, but avoid if regularly overdrawn or you'll face high £1-£3/day charges. No min pay-in for the £100; it's £750/mth for the monthly rewards.
Full eligibility info and more best buys in Best Bank Accounts. | | | | 2. | Get up to 5% 'savings' interest - but rates aren't certain. This market is more susceptible to base rate cuts as its selling point is the savings interest. It was turned on its head by Santander's cut, but smaller savers can still get good rates. Here are the top accounts, but beware: you've no certainty with variable rates.
- 5% FIXED in year one: Nationwide FlexDirect* is 5% AER fixed for a year on up to £2,500, 1% AER variable after (£1,000/mth min pay-in).
- 5% variable + £5/mth: TSB* pays 5% AER variable on up to £2k, plus you can get up to £5/mth cashback on contactless spending (£500/mth pay-in).
- 4% variable interest but on higher sums: WARNING - under review: Club Lloyds pays 4% AER variable on the full balance if you've £4k to £5k in it (£1,500/mth pay-in).
- Rate to dive from Nov, still good for big savers: Santander* will pay 1.5% AER variable on up to £20k from Nov (up to 3% before). Its £5/mth fee is covered for most by up to 3% bills cashback (£500/mth pay-in). | | | | 3. | Seven-day switching means it's mostly no hassle. Just 3% switch banks every year but the perceived hassle is more myth than reality.
Seven-working-day switching was introduced almost three years ago and it's been a game changer. Now your new bank: a) Switches direct debits and standing orders for you. b) Closes your old account. c) Ensures all payments wrongly taken from or paid to the old account come or go to the new one for three years.
The competition regulator last week announced plans to encourage more switching, but they're a long way off. In any case, of those we polled earlier this month, 76% said it was easy or little hassle. Gavin is typical: "I had no problems - very easy and only took 5 minutes to complete a form".
PS: Got bank account switching questions? MSE Helen & Sally are doing a Twitter Q&A at 1-1.30pm on Thu. Send questions to @MoneySavingExp. | | | | 4. | Revealed. The best and worst banks for customer service. Good service is important on your current account, so we ask you how you rate your bank twice a year. Here's the latest result, with a familiar winning face - First Direct, which has won every MSE bank service poll.
| | | Top Major Banks For Service (over past six months)
1. First Direct: Great: 91%; Poor: 3%
2. Nationwide: Great: 79%; Poor: 4%
3. Co-op Bank (incl Smile): Great: 72%; Poor: 5%
4. Santander: Great: 71%; Poor: 6%
5. TSB: Great: 71%; Poor: 7%
6. Halifax: Great: 58%; Poor: 8%
7. Lloyds: Great: 50%; Poor: 15%
8. Bank of Scotland: Great: 49%; Poor: 16%
9. RBS: Great: 48%; Poor: 19%
10. NatWest: Great: 46%; Poor: 18%
11. Clydesdale & Yorkshire: Great: 44%; Poor: 19%
12. Barclays: Great: 43%; Poor: 21%
13. HSBC: Great: 38%; Poor: 18%
Users could choose 'great', 'OK' or 'poor'. See full results. | | | | 5. | Cut overdraft charges to 0%. An overdraft's a debt like any other, so if you often go into the red, cutting its cost makes it easier to clear. Like any other debt though you will be credit-scored when switching.
- Under £350 overdraft? Switch to 0%: First Direct* has a £250 0% overdraft, but also currently gives £100 to switchers, so that'd instantly clear some. So providing you can meet its min £1,000/mth pay-in, nothing beats it.
- Larger limit possible but not certain: Nationwide's FlexDirect* may give a bigger 0% overdraft, but only for a year (50p/day after, so aim to clear before). The overdraft limit you get's credit-score dependent. Full info & more ways to save in Cut Overdraft Costs. | | | | 6. | Free travel insurance - great for older travellers. The Nationwide FlexAccount* is fee-free and incl European travel insurance for account holder(s) up to age 74 - important, as cover is expensive as you get older (min pay-in £750/mth).
Full eligibility info and more options in Best Bank Accounts, or see Cheap Travel Insurance to compare. As with all travel policies, always disclose pre-existing conditions. | | | | 7. | Will I definitely get the top accounts and their perks? To qualify you usually need to use their switching services, pass a credit check, have 2+ direct debits set up and possibly meet other criteria. | | | | 8. | Is it worth paying a monthly fee for a packaged bank account? Many waste big money paying for insurance extras (such as travel or mobile cover) they don't use. If so, cancel and go fee-free. If you only did it because the bank said you must, try our free reclaim packaged bank fees tool.
If you need insurance, packaged accounts can win. For £10/mth the Nationwide FlexPlus* gives world family travel insurance, family smartphone insurance and European breakdown cover. A family needing them all could pay £600/yr separately. See Top Packaged Accounts for more options. | | | | 9. | Barclays customer? Get £48/yr free. Its service is questionable and it's not great on perks, but if you want to stick, at least get a free £48/yr from Barclays. | | | 10. | The accounts if you can't get an account. You need to pass a credit check for those above. Yet basic bank accounts don't do such stringent checks (though most do a credit check for ID purposes), as they just provide a no-frills, no-overdraft service.
Options include the Barclays Basic Account, Virgin Money's Essential Current Account and Co-op Bank's Cashminder. See Basic Bank Accounts for full info. | | | | 11. | Can I still reclaim bank charges for going beyond my overdraft? Yes, if it's contributed to financial hardship - see Bank Charges Reclaiming. | | PS from Martin: After 13yrs writing this email, I'm taking a month's sabbatical - to have fun and be a husband & daddy. So this August the email's in the very talented hands of the MSE team. | | | | | | | | | | | | | | | | | | Plus protect your credit score by working out which deals you're most likely to get before applying
If you need to borrow, it's never been cheaper. Industry bigwigs we've spoken to reckon competition's driven loan rates so low that, despite this month's Bank of England base rate fall, it's unlikely they'll drop much further - at least for higher amounts. Full best buys and help in Cheap Loans, but briefly... -
Lowest rates from £1,000 - £15,000. All are 'representative rate', meaning the rate needs to be given to ONLY 51% of those accepted; the rest may pay more. Higher eligibility calc odds generally mean a better chance of getting the advertised rate. All below are for 1-5yrs, unless stated. - £7,500-£15k: Ikano's* 3.2% rep APR, as is Sainsbury's* (1-3yrs, you need a Nectar card).
- £5k-£7,499: Zopa* and Ikano*, 4.1% rep APR.
- £3k-£4,999: Zopa's* 4.6%-6.9% rep APR, Ikano* 5.8% rep APR.
- £2k-£2,999: Zopa's* 6.9%-7.9% rep APR, Hitachi* (min £2,500) 7.4% rep APR for 2-5 yrs.
- £1k-£1,999: Zopa* is 9.9% rep APR (2-5 yrs), Ikano* 11.9% rep APR. -
Nationwide customer? Trick to beat the cheapest. For new or existing Nationwide current account customers who get accepted for any bank/building society loan (but not peer-to-peer lenders, eg, Zopa), Nationwide will beat the interest by 0.5 percentage points; so a 3.2% loan becomes 2.7%. See Nationwide loan trick. -
Sub-£3,000 loan? 0% credit cards can be cheaper. Some lenders allow money transfers - paying cash to your bank account, like a loan, so you owe them instead for a small fee. Virgin has the current range of best buys and we can tell you if you're certain to get one (subject to ID/fraud checks), via our eligibility calc.
- Virgin 32mths 0%, 1.69% fee (eligibility calc / apply*).
- Virgin 36mths 0%, 2.39% fee (eligibility calc / apply*).
- Virgin 41mths 0%, 4% fee (eligibility calc / apply*). Go for the lowest fee in the time you're sure you can repay, never miss a payment & clear the debt before the 0% ends or they jump to 19.9% or 20.9% rep APR. Read our Credit Card Loans help. IMPORTANT. Ensure you can afford it. Debt's like fire: a good tool, but get it wrong and you get burnt. Only borrow if a) you need it for planned spending, eg, car/kitchen; b) you've budgeted and can afford repayments; c) you minimise the amount & repay as quickly as you can; d) if you're only applying to pay off credit cards, a balance transfer may be cheaper. | | | | | | | | | | | | | | | They make it so complex, so to slash costs (sometimes by £100s) you should often chuck logic out the window
At every turn it feels like you're getting fleeced by train firms. Whether they hide their cheapest tickets, delay your journey home or introduce a likely 1.9% season ticket fare-hike from January, revealed yesterday. But you can get your own back using our tricks. Stay on track for big savings with our Cheap Trains guide; here's the key info... -
 10% off most railcards code. Are you a family, couple, under 26, student or over 60? If you spend £80/yr+ (even on one journey) you save, as a railcard gets 1/3 off most trains. 10% off railcards
-
Free split ticket tool saves £££s. It's bonkers but can work. Same train, same time, buy 2 tickets and you may save large. On a Manchester-London next-day single we saw it at £80. Yet the train stops at Stoke-on-Trent (you needn't change) so we found buying Man-Stoke and Stoke-Ldn for £48 in total. Our free Tickety Split tool shows if you can split. Zoe tweeted: "Tickety Split is awesome. London to Plymouth for wedding, saved £50/person." -
Get alerts when your cheap ticket is on sale. They're usually released 10-12 weeks ahead and early booking saves, so you can get alerts the day your journey's on sale. Also never assume it's too late to book a cheap advance, sometimes you can 15mins before: see firm-by-firm deadlines. And check if two singles beat a return. -
Get paid for delays. Here, time is money - if you're kept waiting 30+ mins you're owed cash in most cases (incl strikes). How to claim for delays -
Ends Thu. Virgin Trains East Coast sale, eg, Ldn-Leeds £14.50 rtn. Limited discounted tickets for 5 Sep to 4 Nov travel. Virgin sale -
Can you earn £170 paying for your annual season ticket, as MSE Megan is? See how to bank a bonus combining company season-ticket loans and 0% credit cards, though you need financial discipline. See Season Ticket Stoozing. | | | | | | | | | They can get this email free every week | | | | | | | | | Plus cheap BBQs, keep kids entertained for free and if you've a right to free tap water
Glimpses of summer have returned to parts of the UK this week, though it's not forecast to last long - typical. As there are a few rays of sunshine, and with the kids still off and a bank holiday approaching, we've rounded up the top summer and outdoor deals. Loads of hotties in our Summer sizzler deals round-up, here are the real scorchers... -
 £1 sun cream meeting min UVA protection level. Just because it's cheap doesn't mean anything's wrong with it. See cheap sun cream from £1 and how to make sun cream last.
Discounted designer sunnies 20% off code, eg, £98 Ray-Bans £57. MSE Blagged. Ltd stock. Cheap sunnies -
120 free or cheap things to do with kids. If you're running out of ideas in the thick of the holiday season, we've inspiration, incl 100-day Kids Pass for £1, free sports. Kids' treats -
Do you have a right to free tap water in restaurants? If you need to cool down, read our free tap water Q&A. -
Hot camping & festival deals, incl £15 two-person tent. Plus sleeping bags, rucksacks & more. Great, if you've got a night under the stars planned. Camping sales £1 BBQs & cheap grub. Smoking deals also incl £15 kettle BBQs, 30 burgers for £10. Cheap BBQ deals | | | | | Sainsbury's Tu 25% off EVERYTHING. In-store and online, incl summer range & school uniform. Tu clothing
SUCCESS OF THE WEEK: (Send us yours on this or any topic)
"Used your tips about changing energy suppliers, saved over £700 a year. Should have done it years ago." - To see if you can save, use our free Cheap Energy Club.
Free £8ish rum cocktails, free £3.50ish beer or cider. Round-up of free booze deals but pls be Drinkaware. | | | | | | | | How best to reduce food waste? A committee of MPs is investigating and wants your thoughts. Does wasted food send you bananas? Go to the MSE Forum to tell the MPs what you think (good and bad) and how problems should be fixed, as the committee is monitoring it.
| | | | | | Which gadgets do you have & which do you use? Consumer tech's a huge part of our daily lives. We'd like to see what's changed since we did this poll a 12 months ago and this year we've added more gadgets including drones, GoPros and Teasmades. Take the gadget poll here Are you the typical MoneySaver? In last week's annual MSE Census we discovered she's a straight, white woman aged 26-35, living in SE England, who's married with kids. She has a degree, earns between £20 & £30k in her full-time job, identifies as an atheist and gets most of her general news from the BBC. And if she had to go on a TV show, it'd be Strictly Come Dancing. See how you compare with the typical MoneySaver in the MSE Census results. | | | | | | | | | | | | | | | | | | | | | | | | | | | Wed 17 Aug - Share Radio, 11.20am
Thu 18 Aug - BBC Radio Manchester, 4.50pm
Tue 23 Aug - BBC Radio Cambridgeshire, 2.20pm | | | | | | | Q: My daughter is about to buy her first home, and had opened a Help to Buy ISA. What is the process for getting the Government bonus? Lesley, via email. MSE Rosie's A: Congratulations to her. She'll need to tell her bank that she's closing the ISA, and get a closing letter from it. Then she should give the letter to her solicitor, who can apply online for the bonus, which gets added to her mortgage deposit. Check early on that the solicitor has signed up to the scheme. If not, you’ll need to get them to sign up or use a new one. Your solicitor can charge you up to £60 to process the bonus so it's worth factoring that in. Don't forget that you must be a first-time buyer purchasing a property costing less than £250k (£450k in London) with a mortgage to be eligible for the up to £3k bonus. For full help and info, see our Help to Buy ISA guide. Please suggest a question of the week (we can't reply to individual emails). | | | | | | | That's it for this week, but before we go, check out this thread from the forum: What's your Olympic height? With Olympic fever at its height, we've found a tool to tell you which sport you'd be most suited to based on how tall you are. We tried it with MSE team members Dan, who suited the 100m sprint, and Eesha, who should try 1500m track, marathon running and gymnastics, it seems. How will you fare? We hope you save some money,
The MSE team | | | | | | |
