Earn-interest-do-good: a savings trend worth following

Written by Rebecca O'Connor on 4th November 2015

Do you know what we are loving this week?

Building societies that offer top-drawer rates and also do some good.

And there’s at least two of them on the market worth highlighting for being good-both-ways, from Yorkshire and Coventry Building Societies.

First up, today’s newly launched Marie Curie Bond from the Yorkshire Building Society. It’s a two-year fixed rate at 2.25 per cent, with 0.2 per cent of the total deposited going to Marie Curie when the bond issue is fully subscribed, which provides care to terminally ill cancer patients.

The bond stacks up well against the best standard 2-year fixed savings bond from Aldermore at 2.35 per cent.

faviconOn a £5,000 deposit, a saver with the Marie Curie Bond would earn £229.92. The same deposit in the Aldermore bond would earn £240 in interest – a difference of just £11 over two years to take the GOOD option.

The issue support’s the Society’s “Hour of Need” campaign, aiming to raise £500,000 to fund 25,000 hours of nursing care for Marie Curie by the end of 2016. It has already raised £390,000.

The bond, which has a minimum opening amount of £1,000, is available through all of the group brands: Yorkshire Building Society, Chelsea Building Society, Barnsley Building Society and Norwich & Peterborough Building Society, from today.

If helping people with cancer is a cause close to your heart, this bond offers a way for you to give on a savings product that is decent financially too. It can pay interest monthly or annually.

Mike Regnier, Yorkshire Building Society’s Chief Commercial Officer, said: “Through our Hour of Need campaign we are having a real impact in our communities by funding Marie Curie nursing support for people with a terminal illness and their families. The launch of this bond is another way that our customers can help support the vital service that Marie Curie Nurses provide.”

Coventry’s bond is a 3-yr rate of 2.35% called the “Poppy Bond” (it’s the society’s seventh year of issuing poppy bonds), supporting the British Legion by paying 0.15% of the total balances to the British Legion at the end of December. You can pay in as little as £1 and the bond matures on December 31 2018.

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The best standard 3-year bond from Charter Savings Bank pays 2.55%. After three years, the Poppy Bond saver would earn £364 on £5,000. If they took the Charter Savings 3-year bond, they would earn £397 – a cost of just £33 to be GOOD with money after 3 years.

Remember that if you are a taxpayer, you will pay tax on the interest paid to you from these bonds, unlike cash ISAs.

Andrew Hagger, good-with-money.com expert and director of Moneycomms, says these two bonds: “offer a great all round deal – the saver gets a rate that’s within a whisker of the best buy in its sector plus the charity receives a healthy donation into the bargain – so everybody wins.”
He adds: “It would be a real shot in the arm for charities if more banks and building societies were able to follow this blueprint whereby both the saver and the charity are able to benefit from a decent financial return.”