Martin Lewis explains ‘especially good’ bank account for older couples | Personal Finance | Finance

Martin Lewis has shared some tips around the best bank accounts that may suit older people and pensioners. He shared some success stories on his BBC podcast and spoke about an account that is “especially good” for the older generation.

The consumer expert encouraged people to shop around and see if they can get a better account, as you can currently get paid a bonus from several banks if you will switch your current account over to them. At the time of writing, these include £220 from HSBC, £200 offers from either First Direct, NatWest, Barclays, or £180 from Santander.

One unusual development here is that you can currently get a switch offer for some packaged bank accounts, which rarely come with switching bonuses.

‘Very exciting’

Mr Lewis said this is a “very exciting and lucrative” opportunity. Packaged bank accounts are current accounts which come with extra perks, such as travel insurance or car breakdown cover for you or your family, although you do have to pay a monthly fee.

Mr Lewis said: “For those who would be buying those insurances any way, they can be a really good deal. Right now, we do have a few packaged bank accounts that are paying you to switch.

“So the amount they are paying you effectively covers that fee, so you are effectively getting the insurances for free.” One such account offer at present is the Nationwide Flex Plus, from Nationwide Building Society. The group is offering £175 to move over to them, effectively covering the £18 monthly fee for the account for nine months.

A key benefit of the Nationwide Flex Plus account is there is no age limit on its worldwide travel insurance, unlike the other packaged accounts with switch offers, making it especially attractive for older customers. One older couple wrote into the show to share their sucess story with their Nationwide Flex Plus account.

‘Great deal’

They said they were both in their 70s and pay extra to cover their health conditions, and still feel it’s a “great deal”. They explained that they also pay £40 to upgrade their cruise cover, to include cabin confinements and missed ports.

This came in very handy recently as they were on a seven-day cruise, where they missed out on two ports. The couple called up the insurer and received £150 each for each of the two missed ports, with the £600 landing in their account “very quickly” with no paperwork needed.

They said: “More than covered our additional premium. Highly recommend.” Mr Lewis was very pleased to hear their account had paid dividends for the couple.

He said: “They do work, and I tend to find they are especially good in two cases. Family with lots of teens and smart phones, because you get all the mobile phones in; or travel insurance cover for older couples and families, because often that can get really expensive.

“Suddenly the cost of the packaged bank account is the same as you’d pay just for the travel insurance, never mind that you get the mobile phone cover and the breakdown cover on top.”

How much could you save with a packaged bank account?

Mr Lewis said if you cash in one of the switch offers to move over to a packaged bank account, you could effectively be getting £500 or £600 worth of insurance for free. This is because some of the bank switch offers typically amount to the same or more than a year’s worth of the monthly fee for the account.

He shared some figures to show how the free perks could save you a lot of money. For example, getting worldwide family travel insurance would typically cost you £70 to £100 for a year. The household mobile phone cover you can get with these bank accounts would normally cost you £75 to £100 per policy, while UK and European breakdown cover could cost you £50 to £100.

As well as the Nationwide Flex Plus offer, you could go for the Santander Edge Explorer, where you can get a £180 payment to switch. The account comes with a £17 monthly fee, so your switch bonus would cover this for a year.

You could also sign up for the Co-Op Bank Everyday Extra account, which has a £12 monthly fee. You can be paid up to £300 to switch over to them, effectively covering the fee for over two years.