Interesting times……….

I’m having a touch of deja vu, having received a letter from my building society on Friday informing me that the pittance interest rate on my savings account is being reduced to 0.50%  as from June 1st.
Hang on, we’re half way through the month and this is the first I’ve heard of it!
I wrote this post a couple of years ago and a lot of what I said then rings true now, especially the bit about there not being enough physical cash to go round.

So before I continue on the Building Society thing, here’s something else to think about.

Debit card payments have overtaken cash as the most popular form of payment in the UK for the first time, according to banking industry figures.

Just think about that for a minute.
If you can’t get your hands on cash, how else are you expected to pay for your purchases?
Carrying wadloads of cash runs the risk of being mugged in the street, and some High Street ATMs are charging you £1.99 (currently) to use your banking card to obtain a bunch of readies anyway. Motorway outlets are charging double that for the same ‘service’ and have been doing so for years. This is your OWN MONEY by the way, not a credit or loan card.

There are still some shops that deal strictly in cash though. Having one of the card machines can prove expensive for the business concerned, even though at the moment, this processing cost is not passed on to the consumer, unless the transaction is below a certain amount in which case there is a levy of 50p.
There was a bit of a hoo-ha recently about one of our major supermarkets applying a charge of £99 for Credit Card transactions at their petrol forecourts before the fuel was pumped and then it being reimbursed. Any plans for other supermarkets to follow suit have been shelved, and this practice withdrawn from the offending chain.

Personally, I’d much rather deal in cash because I can control my spending better, and also you can get some good deals if you’re cheeky enough to ask for discounts.
But the problem is that the Government cannot follow cash, whereas anything through the banking system leaves a paper trail.
Cash in hand or casual labour transactions rarely go through the official books, thus something untraceable can’t be taxed, and so TPTB are trying other methods to trap us.

Loyalty cards have proven that your shopping habits are monitored. How else can you and your neighbour have the same store card, but your details of special offers differ to theirs as they are tailored to your personal shopping history.
So with modern technology and the Big Brother is Watching Your Every Move syndrome, how are we to know that when our cash/bank/debit cards are due for renewal, they don’t have some kind of tracking device implanted so that your whereabouts as well as your spending can be analysed and scrutinised. It would be one way of sorting out the benefit cheats no doubt, but it could also be seen as an invasion of privacy of sorts.
If obtaining cash is inconvenient, consumers will have no choice other than to use cards for payment. That could have a knock on effect for establishments that are cash only who would have to increase their attractive pricing to cover  extra processing charges imposed by the banks for card machines.
I wouldn’t touch internet banking with someone else’s barge pole with all the flaws and problems leaving it open to hackers and fraud.  Neither would I want the latest phone technology and an app that let me do everything on an unsecured micro-wave at the flick of my watch.

However, with more and more High Street banks closing (one of our two major banks here is closing shortly), Joe Public is getting pushed into a corner. He cannot go into a branch of his own bank unless he travels miles, and even if he does, he’s usually faced with a rank of machines rather than an old-fashioned teller like I was who took your money, stamped your book, and passed the time of day throughout the transaction.

Boston is an hour’s drive away and I went into the Building Society on Saturday to get some up to date interest rates for alternatives on my meagre savings.
They are always busy, but a sign of the times was apparent as interest rates are now printed off on request, not listed in their savings leaflets (probably so that they can save on printing costs as the rates continue to drop).
I’m not an income tax payer as my total income is less than a third of the tax-free threshold, so our Leaders bragging about helping the lower paid by taking them out of the tax bracket is laughable in my case. They then add insult to injury by saying I can save £20,000 a year into a tax-free interest ISA. Hell, if I had £20K a year mad money (which I would already have paid tax on anyway when I earned it), the last place I’d put it would be a bank!

It appears that I am entitled to a Loyalty Savings account which attracts a higher rate of interest (Why has no-one told me this?) and so we found the nearest branch to us (20 miles away) and visited it today.
The account is identical to the one I had, save the tiered system of rates.
Before it would be by the balance in the account, now it’s longevity of custom.
After 12 months, you are eligible for this wondrous loyalty bonus rate which starts at .70% in year 2, increasing by .10% every 5 continuous years to a maximum of 15 years or more, which at today’s rates attracts interest at 1% pa. So for every thousand pounds in the account for a year, that equates to £10 interest, tax free.

Armed with two passbooks, one going back to January 2009 which was carried over from a previous book, I could prove I had been a customer for some years. As it turns out, I have been with them almost 20 years, so BANG…….. 1% on my savings please with effect from tomorrow. Sadly it’s not back dated, but at least I’m getting something a little better on my diminishing pot which still has 4 years to run before I officially reach retirement.
Not that the State Pension will see me quids in as they’ve moved the starting goalposts on qualifying work time from 16 to 18, so I ‘lose’ another two years and will thus get a reduced pension anyway.

 

About pensitivity101

I am a retired number cruncher with a vivid imagination and wacky sense of humour which extends to short stories and poetry. I love to cook and am a bit of a dog whisperer as I get on better with them than people sometimes! We have recently lost our beloved dog Maggie who adopted us as a 7 week old pup in March 2005. We decided to have a photo put on canvas as we had for her predecessor Barney, and now have three pictures of our fur babies on the wall as we found a snapshot of my GSD so had hers done too. From 2014 to 2017 'Home' was a 41 foot narrow boat where we made strong friendships both on and off the water. We were close to nature enjoying swan and duck families for neighbours, and it was a fascinating chapter in our lives. We now reside in a small bungalow on the Lincolnshire coast where we have forged new friendships and interests.
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15 Responses to Interesting times……….

  1. colinandray says:

    I am 99% Credit Card usage however, I have one that accumulates credit with usage, and has no fees attached. Given that I always pay-off at month end, I never have to pay interest charges. An advantage of a Credit Card, particularly with sizable purchases, is that it gives you a negotiation point. Over here, the vendor can typically pay 5% to the Credit Card company/bank as a transaction fee. If you are in a position to pay cash, then the vendor will often agree to split that fee (i.e. give you a 2-1/2% discount.) if you pay cash.

    • This is the way a credit card should be used IMO, we always paid ours off at the end of the month so didn’t attract charges, nor did it have a fee for having it. At the moment, we only use ours in an emergency or for on-line shopping as we get a protection guarantee, but the bill still gets settled immediately on receipt. Means of credit is changing, and the rates of interest on some runs into over 1500%. Scares me silly, so we are always careful. So easy to spend money, but trying to pay something back can be difficult for us, so we don’t do it.

      • colinandray says:

        Totally agree. I like the saying that “If you cannot afford to save for something, then you cannot afford to borrow for it.” 🙂

      • My Dad always said I could have anything I wanted, as long as I saved for it. I’ve never forgotten that, hence our three questions:
        Do I want that?
        Do I need that?
        Will my life end if I don’t have it?
        This was modified on the boat to
        Can I wear it?
        Can I eat it?
        Where am I going to put it?
        Saved us a fortune!

      • joyroses13 says:

        Brad believes in that saying. The only time we borrowed money was for our house.

      • As did we, but I did have a car loan through the bank, payments of which were deducted from my wages. Today, we don’t owe a penny and like to keep it that way.

      • joyroses13 says:

        That’s a very nice feeling to have, about not owing a penny! Good for you guys! 🙂

      • colinandray says:

        It’s a shame that more people don’t believe it, after all, if you do not have the available money to save, then where is it going to come from to repay a loan?

      • It’s our biggest fear, that we can’t cover our obligations,.

      • joyroses13 says:

        Good question that you ask, but sadly I think a lot of people just don’t care, at least as far as CC debt goes. People want instant gratification with things, and if it means going into debt to do it they will. They will spend 3x as much or more for the item because of not paying off their credit cards at the end of the month. I am glad that I have a wise husband as far as finances go. We balance each other out. 🙂

        In NYC there is a big billboard in Times Square and it says in bright lights how much America’s National Debt is which is extremely high!! Why we feel the need to broadcast that to everyone I have no clue! Than again, I have no clue why America does a lot of other things either, but hey there are some good things about America, really! 🙂

  2. I am amaze that people don’t realize. This maybe not true out of US. If the store has your and want back you need to small claims. If you have the money the store has to go small court. No one gets into my bank account except Social Security. I prefer u dig cash. I stopped at y bank and get my weekly money and than do my shopping with cash. I would change my bank to one I could if it left the area. I did once when the bank starred charging for credit use. I was that the bank could help if left their area. I changed to my current the same.

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