If your savings are shuffling along like a zombie at a deathly low rate, here are five things you can do to bring them back to life – with no incantations, spells or sacrifices necessary.
1. Bonus expiring? Exorcise your account!
A number of competitively-priced easy access accounts are propped up by a temporary bonus – and when they vanish, usually after 12 months, the rate flatlines.
Just over a year ago, for example, the Post Office Online Saver offered one of the top rates at 1.61% AER (variable), which incorporated a 12-month bonus of 0.96% AER.
If you opened this account, its rate will now have withered to 0.65% AER (variable).
When your bonus expires you should move your money to something more competitive.
Unfortunately, now that the Base Rate has been cut to 0.5%, savings rates are even lower, but that shouldn't stop you from seeking out a better deal.
NS&I's Income Bond, for example, pays 1.00% AER (variable) and there's no bonus to worry about - although remember the rate is variable, so it could change at any point.
You'll need £500 to open the account and you can withdraw your cash whenever you need it.
2. Reawaken long-lost accounts
Some savings accounts may not be dead at all – but old and forgotten. If you’ve ever changed your address or name, or you had an account as a child, you may still have cash in lost accounts.
Mylostaccount.org.uk uses the tracing systems of the British Bankers’ Association (BBA), National Savings & Investments (NS&I) and the Building Societies Association (BSA), and can you help track down old bank, building society and NS&I accounts.
Fill in a few forms using as much information as possible about your old names and addresses and you could reclaim any lost cash. The service can take up to three months, but has recovered more than £645million since launching in 2008.
3. Shield your savings from the vampiric taxman
As of April 6, 2016, basic-rate taxpayers can earn £1,000 of savings interest without the taxman taking a slice. Higher-rate taxpayers can earn £500. Consider it the garlic to a vampiric taxman.
This personal savings allowance applies to savings accounts, current accounts, credit union accounts and peer-to-peer lending.
However, that doesn't mean you shouldn't still take advantage of your annual ISA allowance as this won't count towards your personal savings allowance. You have until April 5, 2017 to save up to £15,240 in a cash ISA and all your returns will be shielded from tax.
Aldermore, for example, offers a one-year fixed rate cash ISA paying 1.10% AER fixed for one year, or a two-year option paying 1.15% AER fixed for two years.
Both accounts require £1,000 to open them and you can transfer existing ISA funds in.
Alternatively, Paragon Bank offers a three-year fixed rate cash ISA paying 1.25% AER fixed for three years. You’ll need a minimum deposit of £500 and the account allows transfers in.
4. Explore the ‘other side’
Peer-to-peer (P2P) lending, where you lend directly to consumers and small businesses and bypass the banks, can earn you higher returns than a conventional savings account.
Zopa, for example, offers three kinds of account. With its Access account, you'll earn a projected annual return of 3.3% after any losses and you can still access your cash if you need to.
The Zopa Classic account pays a projected return of 4.1% and is aimed at those savers who want to leave their money to grow.
The Zopa Plus account, meanwhile, pays a projected return of 6.5% - but be aware that with this account, your money will be lent to riskier borrowers.
It’s by no means a dark art, and the peer-to-peer lending sector has been regulated by the Financial Conduct Authority (FCA) since April 2014, which means all firms must operate under certain rules.
But, the big drawback of P2P is that it isn’t sheltered by the Financial Services Compensation Scheme (FSCS). So this means you could lose all or some of your initial investment.
However, many P2P lenders (Zopa included) have compensation arrangements of their own - just be aware that if you invest in the Zopa Plus account, your money will not be covered by the lender's provision fund.
You can read more about P2P lending here.
5. Better the devil you know
It sounds stranger than fiction, but some current accounts out-perform savings accounts, meaning you’d be better off keeping your cash there - even though current account rates are starting to tumble.
With the TSB Classic Plus current account you can earn 5.00% AER (variable) on balances up to £2,000, plus 5% cashback on your first £100 of contactless payments, including Apple Pay and Android Pay, each month until September 30, 2017. (If you opened your account before June 1, 2016, the offer ends on December 31, 2016.)
However, be aware that from January 4, the account will pay a lower rate of 3.00% AER (variable) and only on balances up to £1,500.
You must pay in £500 or more every month and register for internet banking, paperless statements and paperless correspondence.
Alternatively, the Nationwide FlexDirect current account pays 5.00% AER fixed for 12 months on balances of up to £2,500. After 12 months the rate falls to 1.00% AER (variable). You will need to pay in £1,000 or more to qualify.
If you keep a larger balance in your account, from November 1, the Santander 123 Current Account pays a monthly interest rate of 1.50% AER (variable) on your entire balance up to £20,000. It might not sound competitive, but with savings rates so low, it still beats most savings accounts - and remember you can access your money whenever you need to.
Up until November, the Santander account paid 1.00% AER (variable) on balances from £1,000, 2.00% AER (variable) on balances from £3,000, and 3.00% AER (variable) on balances between £3,000 and £20,000.
You'll need to pay in £500 or more a month, have two active direct debits on the account and pay a £5 monthly fee. The account also allows you to earn cashback of between 1.00% and 3.00% on some of your household bills.
Rest in Peace
There you have it - follow our tips and in no time you’ll be laughing maniacally and yelling “IT’S ALIVE!” as your savings rise from the grave.
Don’t have nightmares…
Peer-to-peer lending is regulated by the Financial Conduct Authority, but your money is NOT protected by the Financial Services Compensation Scheme. There is a risk you may lose some or all of your initial investment.
Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct