New alert reveals changes in rates:will it work?
Filed under: Savings & ISAs
But will it make a substantial difference to your savings, or will you be caught by the catch?
Need to know: Savings
The serviceThe idea is that if your savings rate moves up or down, you'll get a text or email letting you know about it - so you can decide whether or not it still suits your needs - or whether it's time to start trawling the market again. As an interesting additional service, if your savings rate has a bonus you'll be reminded at the point at which it expires, which could particularly useful.
Most of the best rates on the market have a bonus attached at the moment. The banks work on the basis that the vast majority of people will forget to do anything about it when the bonus period comes to an end, so they can go on offering paltry rates for years.
In the past, when rates weren't so disappointing, more of us could be more choosy, and only opt for a long-term rate on the basis we are too busy and too easily distracted to go for a bonus. Now, however, many more people have gone with a bonus, putting many more at risk of sliding quietly onto something uncompetitive in a few months.
Nationwide is trumpeting its new service. Richard Marriott, head of savings, said: "Nationwide is the first savings provider to commit to offer this service to send our savers an alert by text or email. We believe this is the sort of clear and transparent savings information that every savings provider should be giving to their customers."
The catchOf course, it comes with a big drawback. This is a very useful first step in the process of ensuring we get a competitive deal, but in order for it to do us the slightest bit of good, we have to carry out the next steps ourselves.
If your rate drops or bonus disappears, this needs to be the catalyst to ensure we shop around and switch to something more competitive. If all it does is provide a brief burst of frustration, then it's of no benefit to anyone.
But what do you think? Would this inspire you to act, or is it just a gimmick? Let us know in the comments.