Irish households have been slow to move their savings into accounts that would provide a better return. Our research looks at some of the reasons why.
Do you have excess money in your current account that you haven't put into a savings account? Or maybe you've money in a savings account but it's only earning a tiny bit of interest as you haven't taken the time to find the best return for your money?
If so, you're not alone.
Irish households have €156 BILLION on deposit right now. But almost 90% of the money is still resting in accounts that pay little to no interest. This is despite savings rates of up to 4% now being on offer. As a result, Irish savers are collectively missing out on up to €3.5 billion in interest a year. Much to the delight of the banks of course...
At bonkers.ie we wanted to understand why this is the case so we conducted timely research with RED C to look at the reasons why savers aren’t moving their money.
The results
In May we conducted research with over 1,000 adults to ask them why they're not availing of the better saving rates on offer.
Our research shows 25% of people haven't moved their money as they aren’t aware of the better rates of interest now on offer. While this was the case for many years after the financial crash, half-decent rates have been available for well over a year now.
Increasing competition for savers’ money in Ireland from the likes of N26, Revolut, Bunq and Raisin has meant that the rates on offer have improved significantly. And the main Irish banks like PTSB and Bank of Ireland have improved some of their rates too.
Here's a look at some of the best rates now on offer:
|
Provider |
Account name/description |
Savings rate (AER) |
|
Instant Access Savings Account (amounts up to €50,000) |
3.75% |
|
|
12-Month Fixed-Term Account (BluOr Bank) |
3.65% |
|
|
Easy Access Savings |
3.36% |
|
|
AIB |
2-Year Fixed-Term Deposit Account (min. deposit amount €15,000) |
3.02% |
|
Bank of Ireland |
Advantage 24-Month Fixed-Term Deposit Account |
2.96% |
|
N26 |
Instant Access Savings |
2.80% to 4%* |
|
Revolut |
Instant Access Savings |
2.00% to 3.49%* |
*rate depends on type of current account customer holds
Our research also shows 25% of people don't want to lock their money away for a long period of time.
However fixed-rate accounts with terms as short as just six months to a year are now available. And some from Bank of Ireland even allow you to access some of your money mid-term.
And in recent weeks the online-only banks N26 and Revolut have launched instant-access savings accounts with competitive rates of interest where people can top up their savings and make a withdrawal whenever they want within the banks’ mobile apps.
Our research also shows 10% of people think it's too much hassle to move their money. But the online-only banks, and increasingly the main Irish banks, also make it super quick and easy to set up a savings account, especially if you’re an existing customer.
Our research also shows 10% of people haven't had the time to move their savings but intend to do so. And a further 8% say they haven’t sought better rates as they've no savings goal. But even if you’re not saving for a house deposit, a holiday or a new car, you should always be saving for a rainy day. And having your savings in an account that pays the best interest will make that easier.
Just 17% of people say they're availing of the better savings rates now on offer.
Of course, not everyone has significant savings. Almost a third of our respondents say they've no major savings to move into a better paying account.
Get the best return
Are you getting the best return for your savings? If our research is anything to go by, you probably aren't.
Don’t leave your money lying around where it’s earning almost nothing. Make sure it works as hard as you do!
You can easily find the best return for your money on bonkers.ie. Use our savings comparison tool to compare rates from the likes of AIB, Bank of Ireland, PTSB, Trade Republic, Raisin, Bunq, N26 and more in just minutes.
Alternatively check out this informative guide on some of the best options for your money.
