Financial firms are battling to win the custom of the over-fifties, so there are some delicious deals on offer to older savers.
Around a third of the UK population is made up of people aged fifty or over, which puts twenty million adults in this category. What's more, these post-war 'baby boomers' are richest generation in British history. As I revealed in The Golden Generation, this section of society owns three-quarters (75%) of the UK's entire net wealth: £5.2 trillion of a total of £6.9 trillion.
Thus, it's not surprising that financial firms are falling over each other in their enthusiasm to capture some of the substantial wealth that 'Woopies' (Well-Off Older People) have. Of course, as these companies like nothing more than to segment, separate and brand their customer bases, they've happily created a whole new suite of products which cater exclusively to the over-fifties.
For example, there are scores of savings accounts and deposit-based bonds which are targeted solely at savers who are fifty-plus (who are often referred to as 'senior' or 'silver' savers). Some of these accounts require customers to be over fifty, while others set the bar at fifty-five or sixty. However, the big question is: do these accounts offer superior savings rates, or are they nothing more than marketing gimmicks?
To find out the answer to this question, I set the Fool's independent, unbiased search engine to work. It unearthed no fewer than 83 different savings accounts and bonds which are aimed at the over-fifties. As I'd expected, this series of savings accounts included both Best Buys (table-topping high-interest accounts) and quite a few Don't Buys (accounts paying a miserable 4% a year or less before tax).
I have to say that I was greatly amused by the fancy-sounding names of the accounts which propped up the end of the table. Don't be fooled by the upmarket handles, as the junk at the bottom of my list boasted titles such as Premium, Emerald, Gold, Midas and Super. Bah, humbug!
Anyway, let's ignore the dregs and concentrate on the crème de la crème -- these over-fifties savings accounts thrash their rivals:
Best Buy savings accounts for the over-fifties (excluding fixed-term bonds)
Account | Interest | Notice | Minimum | Minimum | Notes |
|---|---|---|---|---|---|
Coventry BS Sixty-Plus Saver Issue 2 | 6.25 | Instant | 60 | 500 | Rate includes 0.75% bonus for a year; |
Coventry BS Sixty-Plus Notice Issue 3 | 6.10 | 60 days | 60 | 10,000 | Rate includes 0.60% bonus for a year; |
Northern Rock Silver Savings Online | 6.00 | None | 50 | 1 | Rate guaranteed to match base rate |
Market Harborough BS onthedot Sixty+ Surfer | 5.85 | None | 60 | 1 | |
Kent Reliance BS Direct 60+ Savings | 5.65 | None | 60 | 1 | |
Loughborough BS Postal Classic PLUS | 5.65 | 30 days | 50 | 100 | Notice- and penalty-free withdrawals |
Any of the above accounts would be a worthy addition to the senior saver's armoury. However, before you rush off to open one of these table-toppers, do check the rest of the market to see if the above deals can be beaten. For the record, here are my two favourite everyday saving accounts, which are open to all adults:
Account | Rate (% AER) | Minimum deposit (£) | Notes |
|---|---|---|---|
6.05 | 1 | Rate guaranteed to be at least 0.25% above base rate | |
5.95 | 250 | Rate guaranteed to be at least 0.25% above base rate |
So, what are you waiting for? Switch to a superior savings account today!
More:The Saver's Greatest Enemy | Savings Accounts With Stings In The Tail