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National Savings interest rate reduction

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I was pottering around the M25 on Tuesday morning when the nice man on Radio 4 explained that National Savings rates were being reduced dramatically from May 2020.

Oh, drat I thought, whilst keeping a wary eye out for the usual combination of potholes and folks determined to undercut and then jump into the space I’ve left in front because I follow the two second rule….

Here’s a link to a Guardian article about the change.

I often recommend clients retain their emergency account in National Savings Premium Bonds and according to the article there will be 173,718 less prizes in May.  That sounds a lot to me. 

NS&I’s saving rates are also being reduced. 

I like NS&I because the capital is safe without worrying about a bank going bust as they are fully guaranteed by the UK Government, and for Premium Bonds because there is always the chance of winning £1m.   A pretty small chance it must be said but you have to be in it to win it. 

For anyone saving their hard-earned cash, this is very frustrating news and a reflection of the incredibly low interest environment we live in.