News

Your 30s are your savings peak

19 November 2018
  • Thirtysomethings are the most disciplined savers, putting away nearly 60% of their disposable income per month
  • And it’s older generations who are the big spenders, saving just over a third of their income
  • But more than one in 10 have never opened a savings account, rising to one in five in their 20s

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UK Grandparents worth £5 trillion

27 September 2018
  • Grandparents’ total net worth adds up to £5 trillion or £350,634 each
  • Majority of grandparents say their kids will be better off than them when they reach the same age
  • Grandparents hold an average of £29,725 in bank and savings accounts

New research from Charter Savings Bank1 shows grandparents are collectively worth over £5 trillion – the equivalent of £350,634 each – and expect their children and grandchildren to be as well off as them when they reach the same age.

Despite owing much of their wealth to being part of the property-owning generation the study found 52% of grandparents believe that their children will accumulate more wealth than them compared to a quarter (25%) who think the younger generation will be worse off.

Grandparents acknowledge that they are worth more now than their parents were at the same age; over half (56 per cent) believe this to be the case versus a quarter (25%) who think they’re worth less now than their parents.

In a sign of how many pensioners are sharing their money with younger generations during their lifetimes, four in ten (40%) grandparents are either already gifting cash to their children and grandchildren or plan to do so. Three-quarters (74%) and half (50%) of grandparents plan to pass down their wealth to their children and grandchildren respectively.

The main source of grandparents’ wealth is their home worth an average of £225,623 which accounts for almost two-thirds (64%) of the value of their assets. Their pension pots (£32,652), investments (£32,013) and bank savings (£29,725) are the other major sources of wealth.

Grandparents are not entirely debt-free – around one in five (19%) still have mortgages on their main home and one in three (32%) owe money on loans and credit cards. On average, they have £14,810 in liabilities predominately due to outstanding mortgages of £11,130 with £2,211 in unsecured debt through loans and credit cards.

Paul Whitlock, Director of Savings, Charter Savings Bank, said: “Baby boomers may be the richest generation ever, but they are optimistic that their families will in time be better off than them. This may be difficult to believe for millennials struggling to reach the property ladder but much of their grandparents’ wealth will eventually find its way to them either through gifting or inheritance.

“While houses are the biggest source of wealth, the savings accumulated by the average grandparent almost match the size of their pensions and investments, demonstrating the role that a healthy savings habit plays in any balanced portfolio.

“Whether you are lucky enough to be expecting to inherit all or part of your parents or grandparent’s wealth or not, it’s important for people of all ages to make regular cash savings and seek out the best rates to live the lifestyle you aspire to have in later life.”

1 Opinium conducted research among 2,007 adults living in the UK on behalf of Charter Savings Bank between 22nd – 26th June 2018

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Multiple Cash ISAs don’t add up for savers

24 May 2018
  • One in five over-55s have five or more Cash ISAs but half don’t know how much they have saved
  • Charter Savings Bank’s Mix & Match ISA enables customers to open as many Cash ISAs as they want within one wrapper

New research from Charter Savings Bank reveals multiple Cash ISAs are not adding up for savers, who are risking leaving their money to stagnate in low interest rate paying accounts.

Its study found one in five (19%) of savers aged 55 plus have five or more Cash ISA accounts, but less than half (48%) know exactly how much is in these accounts and actively check and manage their savings. Women over 55 are more aware of the amount they have in savings than men (54% compared to 44%).

The amount of money sitting in low interest rate paying accounts is substantial. A fifth (20%) of those who don’t know how much is in their Cash ISA accounts, estimate that they have between £10,000 and £30,000 sitting in them. An average of one in seven (15%) estimate that they have more than £30,000 in inactive accounts, of which 18% are women compared to 13% of men.

Over a third (36%) of those who have opened more than one ISA, did so because they had different rates. For others, however, the number of ISAs they hold has increased because they’ve opted to open a new account each tax year.

Charter Savings Bank is offering more choice with its Mix & Match ISA, enabling savers to open as many different types of Cash ISAs as they want within one wrapper, and is using the industry’s eISA system to ensure most savers switching providers will benefit from a fast transfer.

Reasons for holding multiple Cash ISAs

Reason Over-55s with multiple ISAs for this reason

ISAs have different rates

36%

The number has built up as I have tended to choose to open a new ISA account for each new Tax Year

27%

ISAs have different product features

26%

I forgot I had some

5%

Too complicated to transfer them to one provider

2%

One of the reasons savers over the age of 55 do not have multiple ISAs, is because it can be difficult and frustrating managing multiple accounts with different providers. Nearly three in ten (28%) find it annoying managing different rates, while a similar number find managing multiple fixed-term maturities frustrating.

Around a quarter (24%) do not like managing the administration side of multiple accounts and remembering various log in information, while two in five struggles to remember bonus expiry dates (22%) and different notice periods (21%).

Charter Savings Bank’s research found 59% of savers would like the option to split their savings across a range of different accounts to suit their needs.

Paul Whitlock, Director of Savings, Charter Savings Bank says: “It can be easy for savers to lose track of accounts once they’ve been opened, and the longer they’ve been open the more likely it is that something might have changed. Savers could be missing out on better returns if they forget about their accounts. 

“With ISA allowances increasing over the years, it’s possible for savers to have substantial deposits in them so it makes sense to take action. It’s easier than ever to transfer Cash ISAs and so it makes sense to make the most of the simplicity to bag a better rate.

“Our Mix & Match ISA enables customers to split their allowance among different types of accounts so they can fix the rate on some of their ISA allowance while leaving the rest in easy access, all with highly competitive rates.”

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Saving priorities switch as we hit ‘peak stuff’

23 May 2018
  • 74% of savers putting money aside for memorable experiences
  • The over-55s are the most likely to have hit ‘peak stuff’
  • Saving for experiences most popular among under-25s
  • Major family occasions dominate experience-driven savings goals – ahead of holidays and expensive hobbies

New research from Charter Savings Bank1 shows saving priorities are switching as nearly three-quarters of adults (74%) say they focus on putting money aside to pay for memorable life experiences rather than material products. 

As consumerism works to find new ways to separate consumers from their hard-earned cash, many people believe they have achieved a state of ‘peak stuff’, where their homes are filled with more goods, products and materials than they perhaps need.

Of these, nearly half (48%) say they have become increasingly focused on saving for events, holidays and hobbies rather than buying products, suggesting that many consumers have either hit, or are close to hitting, ‘peak stuff’. 

On average, savers set aside a quarter (23%) of their total savings to pay for life experiences.
Major family occasions, such as landmark birthdays and weddings, top the table of savers’ experience-driven savings goals, ahead of a post-retirement holiday of a lifetime and expensive hobbies.

Charter Savings Bank’s research shows it’s the over-55s who are most likely to have hit the ceiling on buying products; over half (51%) of those who have changed their saving plans say they have enough material goods to last a lifetime.  Around one in ten over-55s (11%) estimate they spend more than half of their savings on events and experiences.

The under-25s are the age group most likely to save for experiences rather than material goods (78%), and nearly two-thirds (65%) of them say the key reason for doing so is they enjoy them more. More than two out of five (41%) of twenty-somethings are saving to fund expensive hobbies.  It’s not always a choice, however, as one in four under-35s say they are saving for experiences because they can’t afford to buy expensive assets such as a house or a car.

According to the study, on average people have so far spent nearly £4,200 on life experiences, while one-in-12 (8%) have paid over £10,000.

Around half (48%) of adults are currently saving for a major life experience with an average value of £3,400, but one in 20 are setting themselves a target of over £20,000.

Paul Whitlock, Director of Savings, Charter Savings Bank, said: “Many people are realising that when they buy ‘stuff’, it usually only depreciates in value, becomes obsolete, and the memory of its purchase wanes. However, when paying for meaningful events, the anticipation of the experience provides more than just a quick rush, and the memories after the event grow ever more valuable.

“The new car soon loses its ‘new car smell’, the new phone quickly becomes last year’s model, and the latest ‘must have’ gadget promptly becomes part of the furniture. But a holiday-of-a-lifetime can provide months of pleasurable anticipation and planning, then memories and anecdotes for years to come.

“Getting in to the habit of saving regularly can help us all achieve our ambitions, whether it’s memorable experiences for those of us with a house full of things, or consumer products for those who haven’t yet reached a state of ‘peak stuff’.”

Percentage of people who have spent money on different experiences

Type of experience or event Percentage of people who have saved for or plan to save for this experience

Major family events

50%

Post-retirement holiday of a lifetime

26%

Expensive hobbies

21%

Wedding anniversary

14%

Round the world tour

11%

Safari holiday

10%

Attending major overseas sporting events

10%

Extreme sports challenges

7%

1 Consumer Intelligence conducted research among 1,040 savers on behalf of Charter Savings Bank between 1st and 2nd May 2018.

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Cash ISA savers missing out on the transfer market

20 February 2018
  • Half of Cash ISA savers aged over 55 have never transferred accounts
  • Two out of five say they won’t switch because they want all their savings in one place and one in 10 believe transfers are too complicated  
  • Charter Savings Bank’s Mix and Match ISA platform enables savers to spread their annual allowance in more than one Cash ISA product at the same time

New research1 from Charter Savings Bank shows Cash ISA savers are missing out on transferring their accounts to gain more competitive rates and increased flexibility because they value convenience over better returns and fear the transfer will be too complicated.

The research indicates that half (50%) of Cash ISA savers aged 55-plus have never moved their accounts to another provider, with more than two out of five (43%) saying they don’t transfer their savings because they want all their money in one place.

However, nearly one in 10 (9%) say they have never transferred because they think the switch will be too complicated, while 42% believe they will not be able to secure a more competitive deal.

HMRC data2 shows around 10.3 million over-55s have money in Cash ISAs, with around 3.9 million opening new accounts each year. Under current ISA rules, most providers only allow savers to deposit their annual allowance into one type of Cash ISA account per year, limiting options for savers.

Charter Savings Bank is offering more choice with its Mix & Match ISA platform, enabling savers to spread their annual allowance within multiple Cash ISAs.

Most providers only offer a Fixed Cash ISA or Easy Access Cash ISA as an option to their customers and lock them in, whereas the Mix & Match ISA gives the customer flexibility.

With the Mix & Match ISA, customers don’t have to put all of their annual allowance into one single Cash ISA. They could for example open an Easy Access Cash ISA with £5,000 and then the following month deposit £10,000 in a 1 Year Fixed Rate Cash ISA product. If they have more money available they could open a third Cash ISA product using the remaining £5,000 of their annual allowance.

Charter Savings Bank has also adopted the industry’s eISA system to ensure most savers switching will benefit from a quick and simple transfer.

Its research shows the main motivation for transferring Cash ISA accounts from their existing provider is a rate reduction: 51% of over-55s who have moved said they switched because of a reduction.

Just 35% of over-55s say they always assess the Cash ISA offers each year and move if they find a better rate, while one in three (33%) say they move when the fixed rate term on their Cash ISA expires.

Charter Savings Bank’s research found the age group most likely to transfer Cash ISAs are those aged between 25 and 44 – around 62% of them have switched their Cash ISAs.

Paul Whitlock, Director of Savings, Charter Savings Bank says: “Transferring Cash ISA accounts is a straightforward process, now that the industry has signed up to new standards and is utilising new technology and systems.

“People regularly shop around for more competitive deals on a wide range of goods and services, and that should also be the case in the Cash ISA market. Those who don’t move are risking missing out on more competitive rates, greater flexibility and access to their savings when needed.

“The Charter Savings Bank Mix & Match ISA provides flexibility for savers and enables them to split their allowance across multiple accounts, all with competitive rates.”

Visit chartersavingbank.co.uk for full details.

1 Consumer Intelligence conducted research among 1,021 cash ISA savers on behalf of Charter Savings Bank between 24th and 25th January 2018.
2 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/640743/Full_Statistics_Release_August_2017.pdf

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Customers vote Charter Savings Bank Best Online Savings Provider for third year in a row

02 February 2018

Charter Savings Bank is celebrating its third anniversary early after winning the Online Savings Provider of the Year for the third year in a row at the 2018 Moneyfacts Consumer Awards.

More than 160,000 customers voted in the awards which are designed to identity the organisations which combine technical merit with service excellence and cover personal, household and family finance.

Charter Savings Bank received its award, which it also won in 2016 and 2017, at a ceremony at The Royal Lancaster Hotel in London.

The Online Savings Provider 2018 trophy takes the total of awards won by the bank since its launch in 2015 to 16 for its savings accounts and service in addition to a number of Highly Commended awards.

Paul Whitlock, Director of Savings, Charter Savings Bank said: “The fact that customer votes are a major part of these awards makes winning Online Savings Provider of the Year so special.

“Our aim since we first opened for business has always been to combine simple, straightforward savings products with good service and it is good to see that reflected with the Moneyfacts Consumer award.”

Shortlists for the Awards are assessed by Moneyfacts’ research team and only the companies rated as offering the best products go on to form the shortlist which is then voted on by customers. More than 160,000 customer surveys were completed making the 2018 awards the most competitive ever.

The University of East Anglia was commissioned to independently verify the customer survey and the subsequent analysis to ensure the process is fully transparent.

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Financial Services Compensation Scheme

Financial Services Compensation Scheme

Your eligible deposits with Charter Savings Bank are protected up to a total of £85,000 by the Financial Services Compensation Scheme, the UK's deposit protection scheme. Any deposits you hold above the limit are unlikely to be covered. Please click here for further information or visit www.fscs.org.uk.