Page 38 Daily Mail, Wednesday, August 21, 2019
38 MoneyMail
Easy access Shawbrook Bank Easy Access 15 1.48
Fixed-rate bond Atom Bank One-year fix 2.0Easy-access cash Isa Shawbrook Bank Easy Access Cash Isa 5 1.43
Fixed-rate cash Isa Cynergy Bank One-year fix 1.61ONLINE ACCOUNTS
PROVIDER ACCOUNT RATE %
BRANCH ACCOUNTS
PROVIDER ACCOUNT RATE %
Easy accessKent Reliance Easy Access Account 34 1.3
Newcastle BS Community Saver 2 1.16Fixed-rate bondMetro Bank One-year fix 1.9
Tipton & Coseley BS To October 31, 2020 1.6Easy-access cash IsaMarket Harborough BS Easy Access Isa 2019/20 1.25Newcastle BS Community Saver Isa 2 1.16Fixed-rate cash IsaMetro Bank One-year fix 1.55
Newcastle BS Fixed to August 24, 2019 1.5SAVINGSSTAR BUYS
OUR expert’s pick of this week’s top deals on different types of accounts
TYPE
TYPE
FOR MORE BEST-BUY SAVINGS TABLES GO TO: THISISMONEY.CO.UK/SAVESYLVIA MORRIS’S
By Sylvia Morris
Premium Bond gift for the kids
AUNTS, uncles, godparents and family
friends can finally purchase Premium Bonds
as gifts for young children from this week.
Previously, only parents and grandparents
could buy the bonds for children under 16.
The change, first revealed in the October
Budget last year, is aimed at helping young-
sters get in the habit of saving.
John Glen, economic secretary to the
Treasury, says: ‘This will encourage a savings
culture by giving young people something
to build on when they themselves start
saving for the future.’
Premium Bonds are sold by National
Savings & Investments (NS&I), the govern-
ment savings bank. They do not pay interest,
but deliver monthly tax-free prizes — worth
an average of 1.4 pc a year.
More than 21 million hopeful winners have
invested over £81 billion in the Bonds.
The odds of each Bond number winning
any prize, including one of two £1 million
jackpots, are currently 24,500 to one.
This month, NS&I paid out £95.6 million in
3,346,095 prizes, varying from £1 million to
£25. The vast majority were for £25.
Just under 50,000 prizes worth more than
£1.3 million were won by under-16s. NS&I
has already attempted to make Premium
Bonds more accessible as presents for
children by slashing the minimum invest-
ment from a hefty £100 to £25 earlier this
year — the first cut in its 63-year history.
The lower limit has seen sales soar —
nearly half a million were bought in just two
months to the end of March. Around 11,000
were for children, with 778,000 under-16s
now holding £1.2 billion worth of the bonds.
Already, Premium Bonds have turned ten
under-16s into millionaires since 1994.
NS&I first allowed grandparents to buy
Premium Bonds online for grandchildren in
August last year. Since then, 43,000 of them
have taken advantage of the scheme.
The largest prize won by children in thepast year has been £10,000, with 36 £1,000
prizes awarded. The average age of new cus-
tomers has also dropped, from 47 to 34.
You can buy Premium Bonds as gifts online
at nsandi.com/gift or by post.
They must be managed by the child’s
parent or guardian — no matter who bought
them, until they are 16 — who will receive all
paperwork and prize money.
More than one in ten who bought bonds as
gifts said encouraging someone to save was
part of the reason they had done so. If you
win a prize, you can either take the money
or reinvest it in more bonds, although the
maximum any person can hold is £50,000
Over its last financial year to the end of
March, NS&I paid out over £1 billion in more
than 37 million prizes.
With the new Ernie 5 (Electronic Random
Number Indicator Equipment) introduced
this year, picking the winning numbers each
month now takes just 12 minutes — down
from a previous nine hours.
[email protected]Just 72 accounts
beat inflation
THE rise in the cost of living to 2.1 pc a
year makes grim reading for savers.
There are now just 72 accounts that
match or beat inflation, compared to
240 in January when inflation stood at
1.8 pc, says Savings Champion.
And none of these accounts is an
easy-access deal — the most popular
type of account — the top rate for which
is currently 1.5 pc. This is paid by just
two providers, and both have quirks.
Marcus by Goldman Sachs has a
bonus for a year, then the rate drops to
1.35 pc; Virgin Money Double Take is
limited to two withdrawals a year.
There are no one- or two-year bonds
that either beat or match inflation.
Metro Bank has the shortest fixed-rate
bond beating inflation, at 2.15 pc, for
three years.By Samantha
Partington
cut to their guaranteed bonuses
because it could no longer afford
to pay them. But savers revolted
and the case went to court.
Equitable Life lost but was
unable to pay its £1.5 billion
obligation to policyholders. It went
up for sale in the summer of 2000.
Since then, customers have
fought to get a fair payout.
In 2010, the government stumped
up £1.5 billion in compensation for
Equitable Life Payment Scheme
with-profits policyholders.
The payout acknowledged the
government and regulator’s poor
oversight of Equitable Life’s prom-
ise to pay unachieveable bonuses.
But it fell far short of what savers
were really owed. This scheme is
not connected to October’s vote.
Now, Equitable Life is offering
to share out its £1.7 billion fund,
held in reserve to protect pension
savers’ policies, to further
compensate its savers.
WHAT IS THE
VOTE FOR?
EqUITABLE Life wants to trans-
fer the business to a new owner
— Utmost Life & Pensions,
formerly known as Reliance Life.
At the same time, the company
is proposing to transfer all so-
called with-profits policyholders
to unit-linked pensions, removing
any investment guarantees.
Unit-linked plans are directly
linked to investment performance,
which means the value can go
down in a bad market.
Only with-profits policyholders
can vote to approve or decline the
deal. If it goes ahead they will be
giving up the scheme’s generous
growth guarantees. But they will
be given a share of the £1.7 billion
pot of cash.HOW MUCH
WILL I GET?
WITh-PROfITS policyholders
are expected to receive a top-up
to their savings of around 68 pc of
the value of their investment.
The average payout should be
around £9,520, which will be paid
on top of the existing pot of money.
Group pension policyholders
who have with-profits benefits
should receive around £2,380.WHY WON’T I GET
ANYTHING?
SAvERS with other types of
policies, such as unit-linked or life
assurance, will not receive any-
thing — and cannot vote either.
This is because anyone who has
a with-profits policy is classed as a
member of Equitable Life andtherefore an owner, under the
rules of a mutual. Only members
can share in the profits — and
losses — and are eligible to receive
a part of Equitable’s cash reserve
when it is divided up.WHAT IF I SOLD
MY POLICY?
YOU will not receive any money.
The mutual’s money belongs to
current with-profits policyholders
only. It is similar to owning shares
in a company. If you sell those
shares, you do not expect to
receive future dividends.WHAT POLICY
DO I HAVE?
YOUR policy type will be shown
on your April annual statement.
If you recently received an infor-
mation pack from Equitable Life,your policy name will be included
on your personal illustration.
You can also call 0330 159 1530 to
find out your type of policy.IF THE PROPOSAL
IS APPROVED...
... YOU will receive your payout
and be moved to a unit-linked
plan. You will then have until
December 13, 2019, to choose
where to invest your money.
Details are included in the infor-
mation pack being posted out.
If you do not select any funds for
your new plan, your boosted
savings pot will be moved into a
secure cash investment for six
months. After that, if you still have
not made a decision, your savings
will be gradually moved into the
firm’s default investment option.
If members vote against the deal,
investors will not get the top-up
and their money will remain in
their existing policy.WHAT HAPPENS
IF I’M RETIRING?
If YOU want to withdraw your
savings today, you would get a
top-up worth around 35 pc of your
with-profits policy. This amount
could go up or down until the deal
is approved. Most pension savers
can choose to defer taking their
savings until the vote is com-
pleted. If your policy matures
before the payout is finalised, you
will not be entitled to any uplift.WHAT NEXT...?
ThE deadline for postal and
online votes is 10am on October- You can go to the meeting at
Central hall Westminster, Storey’s
Gate, SW1h 9Nh on November 1
at 10am. If savers approve the
deal, it has to be rubber-stamped
by the high Court, on November - Payouts and transfers would
then begin on January 1, 2020.
for more details, write to
Equitable Life Assurance Society,
Walton Street, Aylesbury hP21
7qW; 0330 159153; equitable.co.uk.
Savers are also being offered
subsidised financial advice.
[email protected]
IN OCTOBER, tens of thousands of
Equitable Life savers will finally be
asked to vote on a compensation
offer from the failed mutual.
After a two-decade battle for justice, more
than 160,000 policyholders will receive a letter
this month explaining how the decision could
impact their retirement fund.
Many will have already spotted the large ads
in national newspapers that read: ‘Time to
decide on the future of Equitable Life.’ But
what does the vote really mean for you?
WHAT HAPPENED
TO EQUITABLE LIFE?
IN ThE Nineties, Equitable Life was one of
the country’s largest and most trusted life
insurance and pension firms.
Most of its savers had taken out so-called
with-profits plans, which were designed to
smooth out the ups and downs of the stock
market and offer a steady rate of return.
The idea was that the firm would keep back
some of the money it made when times were
good to pay out when stock markets fell.
But it failed to put enough money aside and,
in 1999, tried to make policyholders accept a
Last hope
for victims
of Equitable
injustice