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Martin Lewis, the money saving expert, slammed the current savings “crisis”, but provided a beacon of hope for Britons with a “three tier” savings plan. Speaking on the Martin Lewis Money Show on ITV, Martin spoke out on the changes to NS&I’s savings rates, while showing the nation’s savers what other ways they can save.
NS&I announced this week they will be slashing their savings rates from the current rate of 1.16 percent to 0.01 percent from 24 November.
Their Junior ISA, meanwhile, will be cut from 3.25 percent to 1.5 percent.
So what can Britons do to beat these woeful rates?
Martin had a “Three Tier” plan to follow, which he explained in detail.
Tier 1: The Unbeatables
On this first tier, Martin had Help to Save, and Lifetime ISAs.
He advised Help to Save is a good option for those on low incomes, such as Universal Credit, and up to £50 per month over two years can be saved initially.
Savers will enjoy up to a 50 percent bonus paid on the highest amount in the account at the end of the two years.
Lifetime ISAs, meanwhile, are best for first time buyers aged 18-39, Martin said – with the top interest rate LISA tipped by the money saving expert as Moneybox at 1.1 percent.
Tier 2: Higher Interest on Lower Amounts
Next, Matin looked at regular savings accounts – good for saving a set amount each month.
He named a host of choices, with up to £500 a month allowed to pay in. The best rates are to be found with RBS and Natwest at three percent variable.
Savers could also look at high interest current accounts – Martin name checked Virgin Money and Nationwide FlexDirect here.
Tier 3: Lump Sums and Big Savings
Finally, Martin moved onto those with large amounts to save.
So far, NS&I have cut rates but others haven’t followed suit – but Martin warned their cut “may pull others down”.
He listed four options for fixed rate accounts which savers can’t withdraw from during a set amount of time – Masthaven, Aldermore, Paragon and UBL.
Martin’s top easy access accounts for flexibility where the final option he looked at.
All of these accounts have a variable rate.
The money saving expert listed Coventry, Yorkshire, Principality, Yorkshire, Cynergy and Skipton.
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