Nationwide Building Society, for example, has just launched its FlexPlus account – a packaged account which offers refreshingly decent returns on credit balances, as well as a wide range of attached benefits.
We take a closer look at the new account to help you decide if it could be the right one for you.
What’s the deal?
The most eye-catching feature of Nationwide’s FlexPlus account is that offers an annual equivalent rate (AER) of 3.00% on all credit balances up to a cap of £2,500 – more than you would get on even the leading easy access savings accounts.
However, the account comes with a monthly fee of £10 so you will have to factor this in to the limited annual interest you will earn.
For your money though, FlexPlus offers a comprehensive range of benefits. These include worldwide travel insurance (incorporating winter sports), mobile phone insurance, car breakdown cover for the UK and Europe, extended warranty (an additional 12 months starting when the product’s original manufacturer’s warranty expires), ID Theft assistance and global card emergency assistance.
For the initial three months after opening the account, eligible customers will also be entitled to a fee-free overdraft, after which time a £100 fee-free limit will apply.
The FlexPlus debit card also offers fee- free foreign ATM withdrawals and a lower-than-average foreign purchase charge of 2%.
You can open the account in any branch, online, or through a 24-hour call centre. The account also comes with a mobile banking app for your smart phone.
Who’s it good for?
Firstly, FlexPlus is good for the kind of person who finds themselves with cash left in their account at the end of the month – in this case, why not earn 3.00% interest on it?
Secondly, if you were intending to buy any of the benefits listed above separately – and this would cost you more than £10 a month – it’s also likely to be a winner.
Lastly, regular travellers could find themselves substantially better off with a debit card that comes with favourable charges while overseas.
However, if it is just the in-credit interest that appeals and you are not concerned with the attached benefits, you may be better opting for an account like the Nationwide FlexDirect.
This has been recently improved to offer an even better 5.00% AER on credit balances for the first 12 months and comes with no monthly fee to operate.
So, for example, if you had £1,000 left in your account at the end of the month, you would earn £4.10 in interest. Over the course of a year, this would add up to a substantial £49.20. You can read more about the revamped FlexDirect account in Rachel Wait’s article.
The biggest drawback to Nationwide’s FlexPlus account is the monthly fee of £10 – which could outweigh any interest earned if your balance falls lower than £2,500 at any one time.
And if you are someone who regularly dips into your overdraft, not only will you not benefit from the credit interest, but you will be charged 50p per day. Unarranged overdraft charges are a whopping of £5 per day (capped at £50).
While the levels of cover offered by the insurances in the account’s benefits are pretty robust, customers aged over 74 must upgrade their travel insurance account by paying a £50 fee – and there’s no point having an account with great benefits that you are then not eligible to use.
What’s the verdict?
If you are already in the market for a packaged account, Nationwide’s FlexPlus offers good value for its £10 a month and, while you won’t earn a great deal of credit interest, 3.00% is better than nothing which is what just what many current accounts pay.
However, the monthly fee could be a waste of money if you’re not going to make use of the benefits offered by the account, so shop around for a deal on that will better suit your circumstances.
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.