Interest rates on savings accounts across the nation are being reduced.
Nationwide Building Society's latest move has left savers scratching their heads as they slash the interest rates on three of their popular savings accounts. While some top savings accounts on the market offer a staggering 5% return on cash savings, Nationwide's new issues will only return a measly 4%.
The rate cuts come before the Bank of England's base rate meeting on 19 December, with the Bank of England having already cut rates twice, dropping to 4.75% in November. However, it is predicted that the base rate will remain on hold this week.
Are Nationwide's new rates still attractive in the wider market? Previously, Nationwide had gained popularity for member perks such as the £100 Fairer Share Scheme and an 8% regular savings account. But with the new rates, savers may want to keep their eyes open for competitive deals and be willing to switch when their loyalty fails to pay off.
Nationwide will cut the rates on the new issues of its One Year Triple Access Online Saver and One Year Triple Access Online ISA today. Both accounts will now pay 4% AER (variable) for 12 months. The Flex Instant Saver, which is exclusively for current account customers, will drop to 3% (variable).
Moneyfactscompare.co.uk spokesperson Caitlyn Eastell said, "Despite higher rates existing on the market, Nationwide Building Society is still a trusted brand by consumers."
Savers have more choice than ever, with product choice increasing month-on-month to 2,117 savings deals (including ISAs) - the highest count on Moneyfacts' records since February 2007. If you're looking to put money into cash savings, now is the time to act as savings account rates have already reached their peak, and they are only going down from here.
It's worth noting that some providers offer higher interest rates than Nationwide's new savings account rates. For instance, Principality Building Society leads with 7.50% AER / Gross for regular savings accounts while Cahoot offers 5.00% AER on balances up to £3,000 for instant-access savings, and Moneybox currently offers the highest ISA rate at 5.46% including a 1.51% bonus.
So, it's always a good idea for savers to shop around and compare rates to get the best deal on their savings. Keep your eyes peeled for new and competitive deals, and don't be afraid to switch providers when your current one stops meeting your needs.
- In the face of higher rates offered in the market, Nationwide Building Society's new savings account rates of 4% AER (variable) may not be the most attractive option for savers seeking a competitive deal.
- While Nationwide remains a trusted brand, it's essential for personal-finance conscious individuals to compare rates in the banking-and-insurance industry, as there are providers offering higher interest rates on savings accounts and ISAs, such as Principality Building Society's 7.50% AER for regular savings accounts or Moneybox's highest ISA rate of 5.46%.
