Pay Attention To Saving Rate Notification Changes
When you sign up for a savings account, how closely do you pay to the small print? There is always likely to be a headline rate of interest that will grab your attention but is it always going to stay at this level? If it is not, do you know where to find out what the new level will be. A vast amount of savers up and down the country are missing out on better rates of interest because they do not keep up to date with the latest changes to their saving rates.
This occurs because banks and building societies are under no obligation to notify every one of these changes. There is a requirement for these institutions to notify the changes in one or two newspapers and it is the responsibility of you, the customer and saver, to make sure that you have all the information required to keep up to date with the saving rates and the impact on you.
Why do they do this?
Banks and building societies, like all other forms of businesses, rely on people being too lazy or too busy to hunt down the information that will keep them fully informed. Banks will say that they are meeting their requirements by consistently posting the changes in a number of newspapers but this then requires the client to take action and find this information for themselves.
There is a genuine issue with this because most people will have trust in their bank to be doing the right thing. Even though public confidence in the banking industry is at a very low point after the problems in recent times, there is still a greater sense of trust afforded to banks compared to what retailers would receive. This means that many savings account holders will just assume that they are receiving a fair rate or that they would be personally informed of any changes that may have an impact on the amount of money that they can expect to earn.
Banks don’t want you to withdraw your savings and take money elsewhere but equally, they don’t want to offer you too much of an incentive to stay. Like so many industries, banks will often have a focus in obtaining new customers as opposed to retaining their current customers. This goes against the marketing wisdom that says it is more effective to retain customers as opposed to lose them and replace them with new customers but it has long been the way that many industries work.
People are looking for a change in the current situation
There has been some lobbying for a considerable time now for banks and building societies to properly inform customers of any changes in their savings rates in the plainest and simplest manner possible. In response, many banks including Halifax, Lloyds and Santander, write to customers a month or two before any change in savings rates, advising the date of the change and inviting the customer to get in touch. What they don’t do, of course, is automatically move you to a similar high-paying product, so the onus is with the customer to contact the savings provider – something which is easier said than done with today’s busy lifestyles.
There is a need for people to be proactive and if needs be, to be an aggressive saver. Although there can be penalties for moving funds out of savings accounts, another reasons why many people will often decide to stay where they are as opposed to moving their savings, there is often more money to be gained by moving accounts. This may take some time and research to find out the latest changes and what the best options are but in the internet era, it has never been easier to find information.
Be pro-active and save money with other banks that want you
It has also never been easier to find like-minded people who are in a similar position to yourself. It would be highly unlikely that you will be the only person negatively impacted upon by changes in the savings rates and poor notifications of them. Forums and message boards can often be the best way to stay informed of the latest financial changes that can impact on your life and you may find that other people have already obtained the information that you need to know.
This means that a minor level of proactive work can give you a great benefit and it can also help you to stay up to date with the latest changes to savings rates. In the current economic climate, it is not viable to sit back and assume that a bank or building society is going to have your interest at heart. They are going to have their own shareholders and their own profits at heart before they are concerned about you and your money so you should never have too much sympathy or compassion for your bank or building society.