We give our verdict on the latest financial product launches.
A third of households have less than £250 set aside as a financial safety net, according to new research. It found that with average monthly household outgoings currently £1,669, these savings would last just five days.
If this figure fills you with panic, then it is sensible to start saving. To get the most from your money, we have highlighted the latest financial deal out this week.
= New Halifax Isas =
Halifax has launched new issues of its Isa Saver Fixed accounts, although rates have been cut by up to half a percentage point. The rates are now 2.25pc for one year, 2.5pc for two years, 3pc for three years, 3.1pc for four years and 3.2pc for five years. Accounts can be opened with £500 and cash Isas from previous years can be transferred in.
For further information visit halifax.co.uk or call 08457 263646.
Verdict Worth a miss. The latest reduction means there are higher-paying alternatives for every term. According to SavingsChampion.co.uk, those who are looking to lock up their money for the short term can earn 3pc with Saga's one-year fixed-rate Isa or 3.2pc with Ulster Bank's two-year fixed-rate Isa (Issue 5A2). Savers saving for longer can find rates of 3.5pc with Ulster Bank's three-year fixed-rate Isa (Issue 5A3) and BM Savings' five-year Isa.
= Go online to beat inflation =
Derbyshire Building Society has withdrawn its NetSaver Issue 6, which was paying 2.75pc. The account has been replaced with Issue 7 paying 2.5pc, including a bonus of 1.5pc until the end of February 2014. The minimum is £1,000 and the account is online only. For details click here or call 08456 002004.
Verdict NetSaver's withdrawal has reduced the number of accounts that beat inflation, after tax, for basic-rate taxpayers, meaning fewer savers can achieve a real return on their money while retaining access to it. According to Moneyfacts.co.uk , a basic-rate taxpayer would need an account paying 2.75pc to beat inflation, while higher-rate taxpayers would need a rate of 3.66pc.
Although the new rate is still fairly competitive, there are a few easy-access accounts that offer a better return, such as NatWest's e-Savings account, which pays 2.81pc.
= Watch for online bonuses =
Nationwide Building Society has withdrawn its MySave Online Plus (Issue 9) paying 2.71pc and replaced it with Issue 10 paying 2.47pc. The rate for Issue 10 includes a bonus of 0.97pc for the first year. Interest is paid monthly. One free withdrawal is allowed annually, after which 0.1pc is paid for the month in which a withdrawal is made. The account can be opened with £1,000 online.
Verdict "The restrictions on this account could leave savers with a nasty shock," said Anna Bowes of SavingsChampion. "Although the rate reduction sees the rate fall just outside the best buys, it's not uncompetitive. However, should savers make more than one withdrawal, the rate plummets to just 0.1pc for that month, so savers might be wise to choose another account for their easy-access savings."
= Low-rate mortgage =
Yorkshire Building Society has launched a two-year fixed-rate mortgage charging 2.39pc. Available to those with a 40pc deposit, this loan charges an initial fee of £1,295 and a redemption fee of 3pc of the outstanding loan amount for two years. There is also an offset version available at 2.59pc.
For more information visit ybs.co.uk or call 0845 120 0100.
Verdict Thumbs down. Moneysupermarket (Berlin: 39M.BE - news) .com said those with a 40pc deposit could find a better deal. The current market-leading offer from Tesco (Xetra: 852647 - news) is available at 1.99pc fixed for two years with a £995 fee. This loan also offers free valuation and free legal work for those remortgaging.