Category Archives: Savings

Barclays profits tumble 12% as UK interest rates hit mortgage demand

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Pre-tax profits drop to £2.3bn between January and March, down from £2.6bn last year

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Profits at Barclays tumbled 12% in the first quarter, as higher UK interest rates weighed on demand for mortgages and loans and its investment bank was hit by a backdrop of economic uncertainty.

The UK bank said pre-tax profits fell to £2.3bn in the first quarter, down from £2.6bn last year, when it reported the strongest quarterly profit since 2011 after a string of interest rate hikes by the Bank of England.

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UK savers should pick accounts beating rising cost of living while they can

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Many best rates are easy access and notice options rather than ones that lock money away

This week’s news that inflation stayed steady at 4% in January means it is still possible to put your money in a savings account with an interest rate that beats the rising cost of living.

Returns on fixed-rate savings accounts have been falling, but, so far, variable rate deals have remained unchanged.

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More than 11 million Britons have less than £1,000 in savings

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Resolution Foundation calls for auto-enrolment into saving schemes, as millions have no ‘rainy day’ fund

More than 11 million working-age people in Britain don’t have basic “rainy day” savings of at least £1,000, according to a report that warns that the poorest households are struggling to build up financial resilience amid the cost of living crisis.

The Resolution Foundation said people across Britain faced a “triple savings challenge” of insufficient savings, an inability to cope financially with major life events such as family breakdown, and inadequate retirement incomes.

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Savings passbooks popular as Britain turns to cash amid cost of living crisis

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While some banks and building societies scrap system, others report increase in usage by customers

While some banks are scrapping passbook savings accounts amid suggestions they are past their sell-by date, other providers have reported an increase in their usage as people turn to cash to help them manage the cost of living.

Newcastle building society said that in 2023 it issued about three times as many passbooks as it did in 2021, and that it is getting new customers on the back of decisions by rivals to axe them.

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Lifetime Isas: calls to increase price cap that ‘fines’ first-time buyers

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People who want to buy property costing more than £450,000 say they unfairly face losing money

Campaigners are pressing for changes to a UK government scheme for would-be first-time buyers that “fines” people if they use it to buy a home costing more than £450,000.

Martin Lewis, the founder of MoneySavingExpert.com, is among those calling for an urgent revamp of the rules that apply to lifetime Isas, which let people save for a first home or for their retirement.

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UK savers urged to act quickly for best returns as rates drop

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NS&I, Shawbrook and Tandem among providers to make reductions amid flurry of such moves

Savers have been urged to act quickly if they want to get the best returns on their money after a flurry of interest rate cuts on top-paying accounts.

This week NS&I reduced the rate it offers on its three-year green bonds from 5.7% to 3.95%, while Shawbrook, Tandem and Ford Money were among other providers making cuts.

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Don’t get caught out by tax on cash interest, UK savers told

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Higher interest rates and move away from cash isas means hundreds of thousands more people may be hit

Higher interest rates look set to land hundreds of thousands more people with an unwelcome tax bill for their savings, a financial advice firm warned this week.

A couple of years ago it was typically only the wealthiest with very big nest eggs who had to pay tax on their savings interest – but now someone with an emergency savings pot of about £8,000 could find themselves falling foul of this little-known tax trap.

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Huge ethnicity pension gap revealed in UK figures

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Shortfalls fuelled by misconceptions and distrust of employers, as well as lack of spare income, figures show

A UK individual from a minority ethnic background typically has a pension pot less than half the size of that belonging to the average white British saver, data reveal.

The research from Legal & General’s investment arm claimed there was a sizeable “ethnicity pensions gap” in the UK that was being fuelled by “misconceptions” around pensions and a “significant distrust of employers”, as well as a lack of spare income.

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Third of working tenants in England ‘lack savings to pay rent if they lose job’

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Half have maximum of a month’s worth of rent put by as costs rise, Shelter survey finds

A third of working tenants in England do not have enough savings to pay rent if they lose their job, putting them at risk of losing their home, according to research by the housing charity Shelter.

Record rents and the rising cost of other household bills are putting tenants’ finances under pressure and mean many are unable to set money aside for emergencies.

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UK savings: more accounts now offering 6%-plus interest

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Government-backed NS&I increases its rates, as building societies and banks launch better deals

Amid the mortgage misery, there was more good news this week on savings rates, with a growing number of accounts now paying 6%-plus interest.

Meanwhile, the government-backed NS&I – a favourite of many in these uncertain times – has upped the rates on some of its popular fixed-rate accounts.

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Watchdog summons UK bank bosses to discuss weak savings rates

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Financial Conduct Authority to meet executives on Thursday as part of its investigation into savings market

UK bank bosses have been summoned to a meeting with the financial watchdog this week amid mounting concerns that they are profiting from rising interest rates by offering paltry savings rates to customers.

Executives from the big high street names Lloyds Banking Group, NatWest, HSBC and Barclays, as well as from smaller lenders, are due to attend a meeting at the Financial Conduct Authority (FCA) on Thursday to discuss concerns that savings rates are lagging far behind the soaring costs of mortgages and loans.

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HSBC increases interest rates on some savings accounts

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Rises of up to 0.75 percentage points follow increases at First Direct

Customers of HSBC will receive a boost to their savings after the bank announced an increase to interest rates, as Britons enjoy some of the highest rates in more than a decade.

The lender is increasing rates on some of its savings accounts, with increases of up to 0.75 percentage points.

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Public idea of dignified living is miles from what some can afford this winter

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Wifi, Netflix, a laptop, presents for family and the odd night out with friends are in this year’s Minimum Income Standard

What constitutes a no-fripperies minimum standard of living in the UK in 2022? It’s not just sufficient money for three meals a day, suitable clothes, heating and a roof over one’s head, according to the public, but enough for a Netflix subscription, a smart speaker, the odd night out with friends and a supply of Covid masks.

It’s about being able to afford things such as a smartphone, a laptop, wifi, a cooker, a TV, the odd alcoholic drink and also enough to take an unostentatious week’s holiday away in the UK once a year, treat yourself to an occasional takeaway, buy presents for the children and family, and make charitable donations.

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Government plans new laws to protect Britons who use savings clubs

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Move comes 16 years after collapse of Christmas savings club Farepak, which left thousands unable to access cash

New laws are to be announced this week aimed at protecting the hundreds of thousands of Britons who use savings clubs to put money aside for Christmas or pay for other items in advance.

The government said it would also look at whether there were other sectors posing risks to people who prepay for goods or services, and whether similar protections were needed. Home improvements and weddings are two examples of big-ticket items where people frequently hand over substantial sums in advance.

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They became millionaires and retired at 31. They think you can do the same

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The authors Kristy Shen and Bryce Leung are part of a movement called Fire that encourages people to save intensively to retire early

Growing up in poverty in rural China, where her family collectively lived on as little as $0.44 a day, Kristy Shen learned to make decisions based on pragmatism rather than passion from a young age.

On her first ever trip to a toy shop aged eight, after her family moved to Canada, she declined the offer of a teddy bear in favour of a cheaper one and requested that her father send the remainder of the money to their family in China. As a teenager, she chose to be a computer engineer, ignoring her dream to be a writer, based on a formula she devised to rank the best value university courses based on tuition fees versus future pay. And as an adult, any domestic disagreements with her husband, Bryce Leung, are generally won or lost based on who makes the best mathematical case.

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