New research1 from Investec Private Bank reveals that UK adults plan to spend £4.29 billion on membership subscriptions to clubs and societies during 2010, down £362 million on 2009. In total, over a third (36%) of adults – some 17.3 million people – intend to pay subscriptions, worth on average £248 per person, to clubs and societies in 2010.
Overall, 12% of the population (equivalent to approximately 6.0 million people) plan to reduce the amount of money spent on subscriptions to clubs and societies this year compared to 2009, and only 10% (equivalent to approximately 4.7 million people) intend to increase the amount they pay towards subscriptions this year.
Investec warns that on top of this, clubs and societies are also losing out in terms of the return they get on that money as many of the cash deposit accounts targeted at them are paying derisory rates of interest. Its research2 reveals that 30% of accounts are paying a rate of 0.1% Gross AER or less on balances of £50,000 and that only 12% are paying 2% Gross AER or more.
The Investec Business High 5 Account, which requires clubs and societies to make a minimum deposit of £50,000, pays a market leading rate every week3. This is because each week, the independent financial product research company Moneyfacts will take the five highest savings rates in the business savings market across the categories of no notice, 7, 30, 60, 90 and 90+ day notice accounts, find their mid-point and use this to set the rate for the Business High 5 Account. As well as being assured one of the best rates available, clubs and societies also have the added benefit that the rate is set independently.
The Business High 5 Account, which has a three month notice period, does not rely on bonuses to inflate its rate. The current rate is 2.19%3 Gross AER4.
Jack Jones of Investec Private Bank said: “Clubs and associations, like many other sectors, have suffered through the recession and a drop in subscriptions can obviously affect their cash-flow. While there are still some increasingly attractive rates available to clubs and associations, many accounts are offering dreadful interest rates and those running club and association accounts often do not have time to constantly monitor the rates of interest they’re receiving. This is why it is so important that they shop around for accounts that offer a consistently attractive rate of return.”
On a regional basis, the West Midlands has the highest percentage of people (42%) who are planning on subscribing to clubs or societies this year, compared to the North West, which had the lowest (26%). Those in the East of England who intend to spend money on clubs or societies plan to spend the most on subscriptions (£162 per person), compared to the South West, where the average sub is just £52 per person.
To find out more about the Investec Business High 5 Account or Investec Private Bank’s other unique savings products, please call 0845 366 6333 or visit www.businesshigh5.co.uk