Thoughts from an active pensioner who is now somewhat past his Biblical "Use-by date"

"Why just be difficult, when with a little more effort you can be bloody impossible?"

Thursday, 5 May 2011

Does the Nationwide Building Society keep its Promises?

I've always been an enthusiast for the Building Society movement, accepting the premise that with no shareholders requiring dividends they should be able to give their customers a better deal.
I had my first mortgage with the forerunner of the Nationwide, the Co-operative Permanent Building Society, and I have had savings with the Society ever since. Until recently, I believed they invariably provided some of the best savings deals available.
However, looking back, I feel that, as far as their customers are concerned, things have slowly deteriorated over the past ten years or so. The ethos of a non-profit making Building Society, where customers come first, seems to have disappeared and there now seems very little to choose between them and the various banks.
What has brought my anger to the forefront is what has happened to my "TESSA Maturity ISA". When I was working, I invested the maximum annual sum in a TESSA because the interest was tax free. In due course, ISAs were introduced and on its maturity, I transferred the money to a maturity account in order to continue to take advantage of the tax relief.
Now, I know that I should have watched what was happening, but I was stupid enough to trust the Nationwide . Today I decided to review my savings prior to some major expenditure and found (with some difficulty) that my investment was giving a mere 0.5% interest.
Looking around, I can find a number of ordinary savings accounts where, after tax, I would still end up with a better rate of interest. The Yorkshire BS is offering 2.1% gross, 1.68% net on an instant access internet savings account, which would be more than three times what I'm getting form the Nationwide. No doubt I'll find others as I look around for the best buy. Clearly, there is no point in getting interest tax free if the interest is next to nothing and the tax that you are saving is 20% of that!
So to the Nationwide "Promises".
Their website lists "Our Seven Promises to Savers" - mostly they are waffle, and of course they don't apply to my particular account. However as far as I am concerned they have broken an implied promise which they always gave, and that is to treat their customers fairly.
At least I now know which of my savings will be withdrawn to go towards my new conservatory, where in the longer term I expect the value of the money will appreciate considerably faster than it would with the Nationwide.

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