From today (30th May), Marcus by Goldman Sachs will be dropping the interest rate on their Online Savings Account from 1.20% AER to 1.05% AER for existing customers.
They’ve been offering the lower interest rate to new customers since 13th May 2020.
What are your options?
Marcus remains one of the most competitive options at the moment.
If you don’t mind the hassle, there are better-paying alternatives to switch to. However, the difference will be negligible unless you have a large amount of money you want to move.
The top-paying instant access savings account equivalent at the moment is NS&I’s Income Bonds, which currently stands at 1.16% AER – so just above Marcus.
You need a minimum of £500 to open an account, but can deposit up to £1m, and that entire sum is guaranteed by the government. With other savings accounts, only the first £85,000 per bank is protected if the institution goes bust.
As with other instant access accounts, you can withdraw money at any time. But you have to take out a minimum of £500 each time and unlike banks, the transfer isn’t instant – the money will generally land in your nominated account the next working day. Plus, you have to maintain a balance of at least £500 in Income Bonds to keep your account open.
The alternative is The Family Building Society’s Market Tracker Saver account, which currently pays interest rates of 1.13% AER.
However, the building society has already announced that it will be dropping its interest rate to below 1% AER from 1st July 2020 – it hasn’t confirmed the exact amount yet.
For reference, this is what you would get after a year if you put in £1,000 and didn’t do anything else:
Marcus: £1,010.50
NS&I: £1,011.50
The Family Building Society: £1,011.30
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