TSB - Interest Rates on Plus Account now at 0%

Liquid_Entity · 23 Sep 2020 at 14:18

Great !! A big fat 0% on my savings.

We wanted to let you know that from 2 December 2020, we’re reducing the interest rate on your Plus account from 1.50% AER* to 0% AER.

With the recent reduction in interest rates and the current economic climate, we hope you understand the reasons why it has been necessary to take this decision.
Plus account Your current rate Your rate from 2 December 2020
Interest rate 1.50% AER / 1.49% gross variable 0% AER / gross variable
Paid on balances up to £1,500

Pigeon_Killer · 23 Sep 2020 at 14:20

They're all going to do it and it probably won't be long before negative interest rates/bank charges appear. Government wants people spending their money not saving it.

Chrisc · 23 Sep 2020 at 14:30

I mean, they have to do everything they can to give the W*****s at the top a nice big fat bonus!

bremen1874 · 23 Sep 2020 at 14:34

Hardly worth worrying about if it's capped at £1,500.

touch · 23 Sep 2020 at 15:16

Soon be time to ditch that account then.
I've had mine since it was 5% and "We promise this won’t be taken away after a year". Technically, they didn't lie because they took it away before a year :|

There's a few switching bonuses around just now so set up a couple of direct debits on your TSB account, wait until December and switch to either HSBC (£125 bonus), RBS or LLoyds (both £100 bonus)

Energize · 23 Sep 2020 at 15:34

Will probably encourage more people to keep money at their properties which will result in more thefts.

HungryHippos · 23 Sep 2020 at 15:36

touch said:
Soon be time to ditch that account then.
I've had mine since it was 5% and "We promise this won’t be taken away after a year". Technically, they didn't lie because they took it away before a year :|

There's a few switching bonuses around just now so set up a couple of direct debits on your TSB account, wait until December and switch to either HSBC (£125 bonus), RBS or LLoyds (both £100 bonus)

Problem with switching is you don't really want to do it with the "main account" as it hits your credit rating, in fact you don't want to do it too much if you can avoid it.

Having an account for a long time is also a positive for your credit rating.

If doing switches I would use a 2nd donor account that wasn't primary one.

touch · 23 Sep 2020 at 15:45

HungryHippos said:
Problem with switching is you don't really want to do it with the "main account" as it hits your credit rating, in fact you don't want to do it too much if you can avoid it.

Having an account for a long time is also a positive for your credit rating.

If doing switches I would use a 2nd donor account that wasn't primary one.

Yep, you're correct. I use the TSB current account as a savings account and I guess OP is too (as he said he's now getting 0% on his savings) but not everyone will be in the same position. I think most switching bonuses need you to have had the account for at least a year before you can switch so that's why this type of account is perfect for that.

200sols · 23 Sep 2020 at 15:46

1.5% on £1500. It was useless anyway.

touch · 23 Sep 2020 at 15:51

200sols said:
1.5% on £1500. It was useless anyway.

It's a better interest rate than any other instant-access savings account at the moment. May as well put your first 1500 in there.

Basher · 23 Sep 2020 at 15:52

Stick it in a S&S ISA and leave it then for a few years. Should be at least +60% after 5 years (e.g. Vanguard LS 80/20)

silversurfer · 23 Sep 2020 at 15:52

Pay off your mortgage debt is inversely more profitable. 1.5% is likely to be under the rate of value decline for sterling so it should not be though of saving especially.

MissChief · 23 Sep 2020 at 15:55

NS&I have also reduced their interest rates too. I’ve gone from 1% (no great but better than most!) to 0.15%. It beats my Halifax BoS saver with an apparently preferential rate of 0.01%!

touch · 23 Sep 2020 at 16:00

silversurfer said:
Pay off your mortgage debt is inversely more profitable. 1.5% is likely to be under the rate of value decline for sterling so it should not be though of saving especially.

Only if you know you'll never need the money. It's useful to have an emergency fund - especially in the current climate where a lot of jobs and incomes are not as secure.

Beerbaron · 23 Sep 2020 at 16:01

I get more interest on my HSBC advanced debit account than my ISA with them. Are there foreign banks worth opening accounts with?

Rroff · 23 Sep 2020 at 16:05

MissChief said:
NS&I have also reduced their interest rates too. I’ve gone from 1% (no great but better than most!) to 0.15%. It beats my Halifax BoS saver with an apparently preferential rate of 0.01%!

I just got a update from Barclays my ISA is dropping from 1% to 0.02% or something.

Surveyor · 23 Sep 2020 at 16:09

Energize said:
Will probably encourage more people to keep money at their properties which will result in more thefts.

Why would zero percent interest encourage people to keep money at their properties?

Dirk Diggler · 23 Sep 2020 at 16:17

It's TSB, I'd be more concerned about actually being able to withdraw my money or pay my direct debits, which is why they got binned from my wallet.

englishpremier · 23 Sep 2020 at 18:06

All of these banks and other companies that are reducing in credit interest due to the lower BOE rate. Are they also reducing the interest charged on their credit products by the same amount? I'm guessing no.

mmj_uk · 23 Sep 2020 at 18:10

Invest in gold? if the government push forward with another lock down then in a few years people will probably be using their £50,000,000 notes as toilet paper (assuming loaves of bread are out of stock).