Martin Lewis provides advice on savings accounts
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The bank has recently increased the rate on its Regular Saver account from 1 to 3..5 percent with the new rate piquing people’s interest. What’s more, new customers will also receive £150 for switching.
First direct is offering savers 3.5 percent interest in a bid to beat inflation and the account is getting quite a bit of attention.
If savers deposit the maximum amount of £300 per month, the Regular Saver account pays £126 in interest over a 12 month period.
Not only will this mean savers have £3726 in savings at the end of the year, but first direct often wins accolades for great customer service.
first direct customers get 3.5% interest on savings (Image: Getty)
The bank has also raised the interest rates across its Cash ISA, Bonus Savings Account and Fixed Rate Saver accounts.
Customers who don’t have a first direct current account can open one and also benefit from its £150 switching incentive.
They’ll need to pay in at least £1,000 within three months of opening the account using the Current Account Switch Service.
The bonus will be paid into the new account 28 days after the criteria for switching has been met.
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Savers can earn up to 33 times more interest by switching their savings accounts according to latest research.
Samantha Booysen from Investec said too many Brits are showing loyalty to the same high street provider.
Research by Raisin also confirms that loyalty doesn’t pay when it comes to bank accounts.
Kevin Mountford, savings expert and co-founder of Raisin UK said: “Brits really are giving a new meaning to the ‘Bank of Mum and Dad’.”
What are the top instant access savings rates? (Image: Express)
He continued: “However, by sticking with what you were given, over half of Brits under the age of 35 are missing out on huge benefits, as they stay loyal to outdated deals.
“There is no ‘one-size-fits-all’ account that is suitable for everyone throughout their entire child and adulthood.
“It is really important to shop around and make your money work harder for you by looking at what accounts suit your needs and support your financial goals.
“If you do switch bank accounts you will see that often, loyalty doesn’t pay. In fact, it is the opposite!”
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Mr Mountford added: “Banks want to attract new customers, so naturally, new joiners are likely to get the best deals.
“Although you may be tempted to stay with your lifelong account, often because you don’t want the hassle off having to look for a new account – browsing new opportunities for banking is going to give you far better returns in the long run.”
Some Britons have made thousands of pounds from so-called ‘bank bribes’ or ‘sweetening offers.”
Brettt Downes, 41, first switched bank accounts when he was just 18 because he wanted the option of paying by card in shops.
Since then he’s switched at least once a year and does the same with credit card companies.
This allows him to transfer his balance to benefit from new member deals.
He’s never experienced an issue however he says it can have a small impact on one’s credit score.
People are advised to use the Current Account Switching Service (CASS) to make sure their switch is guaranteed.