Spread of 'mouth-watering' savings products

04 July 2007
Alliance & Leicester's new savings account is leading the way as a flood of "highly competitive" savings products enters the market, according to Moneysupermarket.com.

But consumers should establish whether the linked products making higher savings interest rates available are suited to their financial needs, the advice site's head of savings, Kevin Mountford, urged.

Describing the Alliance & Leicester (A&L) savings account's AER of 15 per cent on its Mortgage Regular Saver as "mouth-watering", Mr Mountford added that a competitive savings account rate should not lure customers unless the mortgage the savings account is attached to is also best for them.

High-interest savings alone will not "offset the wrong choice on a mortgage product", he remarked.

According to Moneysupermarket.com, strong competitors to the A&L product include the Abbey Super Monthly Saver account with its ten per cent AER, although that rate also depends on linking the savings account to a current account held with Abbey.

Sainsbury's Bank this week urged UK consumers to move money in their current accounts to high-interest savings accounts after finding that around 19 million people have surplus money in accounts paying interest at just 0.1 per cent.

Find out more about savings accounts


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