Savings interest rates have been so low over the last decade as to be virtually pointless. It has been many years since a savings account was available in the UK that could deliver an interest rate that even came close to inflation, never mind beating it. And, with inflation still at a current rate of 2.8%, that’s still true.
Marcus by Goldman Sachs is currently the highest savings rate we know of, at 1.5%. But there is an alternative:
Virgin Money has now announced an account which pays interest in Air Miles. You put your money in the account, lock it away for a year, and 12 months later, they’ll give you Air Miles instead of money.
If you fancy jet setting around then this prospect is obviously appealing. But there are other potential upsides too.
According to Virgin’s own literature, the equivalent savings rate if the account delivered money instead of Air Miles, would be 2.4%. Which is quite staggering.
Additionally, of course, you don’t have to pay tax on Air Miles, so the ‘interest’ you receive is tax free!
So how much money do you need to put away to get a free flight?
A free economy flight to New York requires around £15000.
Plus, you need to be a Virgin Flying Club member to apply.