Everyday is just awful with B&B

By SYLVIA MORRIS, THIS IS MONEY AND DAILY MAIL SAVINGS EXPERT
Updated:

 

Rising interest rates have not stopped Bradford & Bingley launching a dreadful new branch-based account, Everyday Saver.

The account pays a top rate of 1.24% after 20% tax (1.55% before tax) - and that's on a balance of £25,000. The rate on the minimum £1 balance is even worse at 0.96% (1.2%).

To add insult to injury, it adds a meagre 0.4% (0.5%) bonus if you make fewer than four withdrawals from the account. So £25,000 in the account which you leave untouched earns you just £410 in interest after savings tax - less than half the £1,000 paid by top branch accounts.

Meanwhile, the bank has closed First Choice, a similar account which pays appalling rates of 1.64% (2.05%) at best. Any savers with this account should switch to one of our best buys (see table right).

A second new account from Bradford & Bingley, What If? Saver, minimum £2,000, pays a headline rate of 4.4% (5.5%) and replaces its popular Premier Saver account. But the rate of the new account includes a 0.4% (0.5%) bonus payable for just six months. After that, the rate drops to 4% (5%).

This is a decent rate for a High Street account, but there is no guarantee linking it to base rate. Premier Saver comes with a pledge to pay at least base rate less 1%. This closed account pays 3.6% (4.5%), which will rise to 3.8% (4.75%) next month following last week's 0.25% rise in base rate. But the bank will drop this valuable, long-standing guarantee at the end of the year. Savers should get out before then.

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