Goldman Beefs Up Marcus Savings Offerings

Saga, a financial company geared to individuals over 50, has teamed up with Goldman Sachs consumer bank Marcus to offer two new savings accounts.

The Financial Times reported both companies made a deal to become “long-term savings partners” starting in June, with Goldman wanting to keep expanding retail offerings and raising revenue, while Saga wants to become more competitive in terms of savings offerings.

Saga will take care of customer service, and Marcus will handle the deposits. One of the accounts is an easy access account that will pay a variable interest of 1.4 percent annual equivalent rate (AER).

That is less than the market best 1.45 percent offered by others. The account also offers a bonus 0.25 percent rate for the first 12 months. Marcus’s own easy access savings account has a 12-month bonus rate of 0.10 percent, but it offers a higher AER.

The second savings account option is a one-year fixed rate saver account with a guaranteed 1.15 percent AER. This is below the best rate on the market, which is a one-year fixed rate saver account at 1.85 percent, offered by Habib Bank Zurich.

Both accounts can either be opened by themselves or together, with deposits of between 1 pound ($1.23) and 100,000 pounds ($123,050). The deposits are guaranteed up to £85,000 ($104,592.50) by the Financial Services Compensation Scheme, the U.K.’s equivalent to the FDIC.

One independent adviser said while Saga’s offerings might attract the loyal customer, they aren’t going to find anyone who’s doing their due diligence to seek out the best rate. The one-year fixed rate, according to Justin Modray of Candid Financial Advice, “looks uncompetitive.”

“I’m struggling to see why savers would want to open the Goldman Sachs easy access account via Saga when going direct to Goldman Sachs via their Marcus brand pays a higher rate of interest,” Modray said. “Perhaps Saga is taking a cut, hence the lower rate, to the detriment of its customers.”