Spend and save to support your charity
With Children in Need dominating our TV screens over the coming weekend, we may be considering the best ways to give to our chosen charity. By using one of the growing numbers of charity savings accounts or credit cards we can donate every day as part of our everyday banking.
Savings Accounts
Rachel Thrusell, Head of Savings at moneyfacts.co.uk comments:
“The affinity account market is still dominated by sporting causes, but charity affinity accounts are beginning to grow in popularity. Today you can choose from 39 accounts which donate funds to a variety of charities, ranging from worldwide causes to local based charities.
“Whilst the charity affinity savings accounts do not pay market leading rates of interest, they are by no means the lowest on offer. Some savers are more than happy to sacrifice a little of their interest rate in the knowledge that their chosen charity will benefit as a result. The average rate (based on a £5K deposit) is 3.87%, compared to an average of 4.157% on all no notice savings accounts.
“But the key to a successful savings portfolio is to make sure at the very least your savings are keeping pace with inflation. Make the most of your tax-free allowance and ensure you review your portfolio regularly. Your charity could benefit more if you chose the market leading accounts, and donated or shared your interest income with them independently.”
Credit Cards
Samantha Owens, Head of Personal Finance at moneyfacts.co.uk comments:
“Today over 75 charity donation cards are available, covering most well known charitable organisations. Most cards will donate a specified sum when you first use the card, followed by a further percentage of spend being payable to the charity each time the card is used.
“The majority of charity donation cards do charge a higher than average interest rate. So for those consumers without a competitive deal and holding a balance on their card, this can be a costly way of giving.
“In this case it may be beneficial to make use of a balance transfer deal, or at the very least a low rate purchase card and use the cost savings to give independently to charity. Alternatively a standard cashback card, which typically offers higher returns could be another simple method to raise funds.
“Whilst the idea of giving to charity simply by spending on your credit card or investing your savings can be a simple and effective method, make sure that the contents of your purse or wallet don’t suffer in the process. Always check if using alternative products with preferential rates could save you money and enable you to make individual donations to the charity of your choice.”
Moneyfacts Group
Moneyfacts is the UK’s leading independent provider of personal financial information and our data is used and trusted throughout the financial industry.
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