Bank increases rates on savings accounts by up to 0.75 percent

Savers with HSBC will get a better return on their savings as the bank increases its rates across several accounts.

The biggest increase will be for the MySavings and Premier Savings youth accounts, with rates to increase 0.75 percentage points to five percent.

The rates will also increase on the Online Bonus Saver instant access account. For balances up to £10,000, the rate will go up by 0.5 percentage points to four percent while for balances over £10,000, the rate will go up by 0.3 percentage points to 2.3 percent.

Customers with a Premier Loyalty ISA will see their rate go up 0.5 percentage points, increasing to three percent.

The rate on the One Year Fixed Rate Saver is also increasing by 0.4 percentage points, up to 4.4 percent.

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The Two Year Fixed Rate Saver is also going up by 0.35 percentage points, with a new rate of 4.45 percent.

The new interest rates will come into effect on June 8.

Pella Frost, HSBC UK’s head of Everyday Banking, said: “Over the last few years we have had to learn to adjust to the unexpected and build our resilience.

“Change can have a significant impact on our lives, sometimes financially. We know that having a savings habit helps build financial resilience and means that you’re better placed to handle any disruption.

“Our new savings rates will hopefully help encourage people to revisit their savings habits. We know that eight in 10 people are taking action to tighten their belts and reduce their outgoings in the face of cost of living challenges, which is a great starting point to help build financial resilience.”

Many banks and building societies have increased their interest rates over the past year as the base rate has continued to increase.

The Bank of England has consistently hiked the base rate in efforts to tackle high levels of inflation.

The base rate is currently 4.5 percent with some expecting this to go up again, meaning savers may see their rates go up as well.

Savers may get a better rate by switching to another bank, and some banks offer a cash switching offer, to encourage people to open an account with them.

HSBC has also provided five strategies for a person to improve their financial resilience going forward.

Live within one’s means

This means a person having the discipline of spending less money than they earn. If a person’s outgoings are more than their income, they need to change their finances.

The bank has urged people to address this as soon as possible or the situation could quickly get worse.

Keeping on top of finances

Smart tools are a great way to keep a track of spending and stay on top of finances. HSBC has a Mobile Banking app with a Balance After Bills feature.

This allows a person to see who much they have left to spend over the month ahead after they have paid their basic bills.

Stick to a budget

A budget is important as it can help a person see exactly how much money they have going in and common out each month.

There are many tools and apps online that can help a person create and update their budget.

Reduce outgoings where possible

If a person can see they are spending too much, they can look actively for ways to change their spending habits.

There may be cheaper alternatives for everyday needs such as food which can help a person slash their bills.

Get good value for money

A person may be able to get a better deal by shopping around. One way for a person to do this is to review their direct debits.

Online comparison sites can also help with this process. But people should be mindful to make sure they still get the quality they need from a product or service.

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