The best current accounts to tackle inflation

With inflation at its highest level since April 2012, many households will feel the squeeze when it comes to their finances, as they fork out more for food, energy, goods and services. Essentially, high inflation means you get less for every pound that you spend and with this in mind, now is the time to really get your finances in order — not just your savings, but your everyday banking too.

One of the easiest ways to improve your stressed household budget is to switch bank accounts. Most people will have money in a current account that does little for them, but with greater competition on the High Street, switching bank accounts could improve your finances and help you get more for your pound.

So, if you’ve never switched bank accounts, now is the time to consider the options; you could benefit from cashback, monthly interest payments and even a cash bonus for switching – although you should only ever switch to an account that suits your needs and not because there’s a free cash bonus.

Switching bank accounts is a lot easier than it used to be under the current account switch guarantee, which can see a switch completed within seven days – and the bank will do most of the legwork for you. To help you, we’ve put together the top current bank accounts worth considering.

TSB Classic Plus

If you have at least £500 paid into your account each month and often make purchases using a debit card, then this account can earn you up to £10 a month plus 3% interest. TSB pays 3% interest on balances up to £1,500 and a £5 bonus for having at least two direct debits on the account. If you then use your debit card at least 20 times a month, then you get another £5 bonus. There is no monthly fee. If you switch bank accounts via MoneySuperMarket, you’ll get a £130 switching bonus.

First Direct

If customer service matters to you, then First Direct scores pretty high in that department. If you switch accounts using the current account switch guarantee, First Direct will pay you a £100 bonus, as long as you deposit £1,000 into the account within three months of opening it. Oh, and it will also give £100 if you decide the account isn’t for you!

If you find yourself a little low on cash at the end of each month, then its £250 interest-free overdraft may come in handy. The account does have £10 monthly fee, but this does not apply as long as you pay in at least £1,000 a month into it. The account has a linked savings account, paying 5% interest.

M&S Bank

If you use the current account switching services to move to M&S Bank, you will receive a £185 M&S gift card – £125 when you open the account, and another £60 if you stay for 12 months. You’ll also get access to a linked savings account, which pays 5% interest, and benefit from £100 interest-free overdraft. You need to have at least two direct debits coming out from the account.

If you’re a M&S fan, then you can also benefit from loyalty points for the M&S Loyalty Scheme. The account doesn’t have a monthly fee.

Halifax

Halifax will pay you a £125 bonus when you switch to them (note, this offer ends 13 November). If you pay at least £750 a month into it, you’ll receive a £3 bonus each month. You’ll also get up to 15% cashback when you shop at various retailers and restaurants, but you have to check online and activate the offers.

Tesco Bank

If you can pay in at least £750 a month and are likely to have a balance of up to £3,000, then Tesco Bank’s current account pays 3% interest. If you’re a Tesco shopper, then you’ll also love that you can get two Clubcard points, instead of one for every pound you spend at Tesco (your debit card is also your Clubcard).  The offer is valid until April 2019, and you must have at least three direct debits from the account.

So, if you’ve never moved accounts, now may be a good time, as there are plenty of ways to make your everyday money go further.  If you have more to save, then it’s worth looking at savings accounts or investing. You can read more about the Current Account Switch Service here.  To benefit from switching bonuses, you’ll have to close your existing account.

Rates are correct at the time of publishing and you should check for any changes and latest offers when switching accounts.

Photo by Quino Al on Unsplash

Article is accurate at date of writing.