Martin Lewis: What's the best savings account
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Martin Lewis touches upon numerous money-related issues, but his key focus on this week’s ITV Money Show was savings. While the Money Saving Expert looked at the top easy access rates as well as fixed and notice accounts, he also acknowledged some of the best alternatives on option. These, he said, were absolutely “unbeatable” and should be pursued by Britons – even if it is to see if they are eligible, and if this option suits them.
Martin explained: “These are the ‘if you can do it, you should do it’ options.
“For those on a low income, for example, you are on Universal Credit, there is the Government’s Help to Save system.
“Here, you can put up to £50 per month in over two years. What it does is pay you a bonus of 50 percent on the highest amount you’ve put in.
“If you’ve had the money in for a year, for example, and you’ve built up to £600, but then you have a problem where you need the cash, because the highest amount was £600 – 50 percent of that is £300. That’s the bonus you’ll get.
“It is totally unbeatable. If any of you are eligible, you need to go for that. It’s a big winner.”
To be eligible, a person must be in receipt of Working Tax Credit, entitled to Working Tax Credit and receiving Child Tax Credit, or claiming Universal Credit.
If a person receives Universal Credit, they must have earned £617.73 or more from paid work in their last monthly assessment period to be eligible for Help to Save.
Individuals also need to be living in the UK to open this account.
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However, this is not the only option on the table, and Martin moved onto what is known as a Lifetime ISA – a tax-free savings option.
This is also a key account which could help Britons to boost their savings due to its bonus, the expert explained.
He continued: “Very similarly, there is the Lifetime ISA, often for first time buyers.
“If you’re aged between 18 up to 39 as a first time buyer buying a qualifying house, you can get a 25 percent bonus on savings towards it.
“You can put up to £4,000 per year in, so the maximum bonus each year is £1,000.
“The top Lifetime ISA is Moneybox at 0.6 percent.
“You do need to do a bit more reading, but absolutely that is a great place to save.”
However, aside from these accounts, there is also a key priority for those who are hoping to improve their financial situation.
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Martin concluded by urging Britons to take action to clear debts before they even contemplate reaching savings goals.
He said: “My final no brainer is that if you’ve got expensive debts like credit cards, pay them off before you save.
“The interest you’re being charged is way more than the interest you’d get in savings.
“If you’re thinking you need to have some cash, if you clear your credit card – I’m not saying cut them up.
“If you need to spend on them later, you could always spend on the credit card and borrow back. At least in the meantime you’ve saved that expensive interest.”
The Martin Lewis Money Show: Live continues on Thursday at 8.30pm on ITV.
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