#cheap #savings #accounts
Ford launches inflation-busting savings accounts paying 4%
UPDATE 24th May: After being on sale for just a few days, Ford Money has pulled these accounts from sale, citing huge demand. They are no longer available.
New savings account provider Ford Money has launched two new accounts which will give savers a chance to escape the clutches of rising inflation and earn 4% on their savings.
Savers will be able to put away £3,000 a year into Ford s regular savings account or regular cash Isa, and earn 4% for 12 months.
This means Ford is now paying the best rate of return on a regular savings accounts that is freely available to all UK savers.
Find out more: Which? Money Compare allows you to compare hundreds of savings and cash ISA accounts from providers large and small to find a great savings rate based on quality of service as well as cost and benefits.
How do Ford s 4% accounts work?
A regular savings account requires you to pay in a certain amount of money each month into the account. Usually, you have to make minimum deposits each month and aren t permitted to make withdrawals.
With a regular cash Isa account, you don’t pay any tax on interest you earn on savings. You can deposit up to £20,000 tax free in an Isa during the 2017-18 tax year.
With Ford s accounts, you can save between £25 to £250 per month and can vary the amount you save from month to month. And you won t encounter any penalties if you decide not to make any deposits at all.
However, you won’t be able to withdraw any money from the regular savings account or close the account within the first 12 months.
Savers using the saver cash ISA can make withdrawals, although they’ll face losing 90 days’ interest on any withdrawals they make. For example: if you have £1,000 saved and you withdraw £200 you’ll lose £24 in interest (12% of £200).
Ford s Our Best Rate Guarantee
Ford Money wants to give customers peace of mind that they won’t be hit by rate-cutting tricks by offering an ‘Our Best Rate Guarantee.’
Both new and existing customers will earn the same interest rate. Ford won’t launch multiple issues of the same account.
For fixed-term savings products, savers will benefit if the account’s interest rate is increased after they signed up for the account but before the 14-day cooling-off period ends. Meanwhile, savers with the fixed-term cash Isas will get the either the rate they applied for or, if the rate has increased before they’ve made a deposit, the new, higher rate.
How do Ford s 4% accounts compare?
The regular savings market is split between accounts open to everyone, and those only available to customers who hold another product with a bank or building society.
Of those open to everyone, Ford takes the top spot, as the table below shows.
The cash Isa account also tops the table for the Isa regular saver market but you are limited to saving only £250 per month into it. Other regular saver Isas allow you to deposit the maximum £20,000 Isa allowance on a monthly basis (between £1,600 and £1,666).
Ford does allow you to spread your Isa savings across its range of instant-access and fixed-rate Isas. however, enabling you to deposit the full £20,000 in total with the bank.
Ford Money Regular Saver
If you already hold an account with Ford Money, you’ll get 5% rate for 12 months. That puts it on a par with the rest of the accounts offering top rates if you already hold products M S Bank, First Direct, Nationwide, Santander, all of which offer 5% AER.
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Posted on 1 Aug 2017
Posted on 31 Jul 2017