Virgin Money is offering a savings rate of 6.25% in a savings account when you also deposit at least £5,000 into a Stocks and Shares ISA and leave it there for a year.
You’ll get the standard fixed rate of 4.25% AER fixed plus a bonus rate of 2% on a matched amount of money in your savings account. Bear in mind that’s the rate right now, since the offer runs until September it might be the underlying fixed bond could have changed if you open it later.
How it works
You’ll earn the bonus on amounts that match the balance in the ISA. Say you chose to put £5,000 into your Stocks and Shares ISA – you’ll then be able to get the savings rate on the same amount put into your savings account.
If you put more into your ISA, you can earn the rate on a higher amount in your savings account. The money needs to stay in both accounts until the fixed account ends to earn the bonus interest rate on your savings.
| Amount in Stocks and Shares ISA on 30 September 2024 | Amount in savings account | Amount in savings earning full 6.25% | Total cash with Virgin Money |
| £5,000 | £5,000 | £5,000 | £10,000 |
| £10,000 | £5,000 | £5,000 | £15,000 |
| £5,000 | £10,000 | £5,000 | £15,000 |
| £10,000 | £10,000 | £10,000 | £20,000 |
To get it, you need to pay into a Stocks and Shares ISA with the amount you’ll want to earn on in your savings account by 30 September 2024. The amount in this account on 30 September 2024 will be your “match limit”— the amount Virgin Money will pay the higher rate on in your savings account.
Then, you need to open an E-Bond Exclusive savings account with the amount you want to save before 7 October 2024.
How much you’ll earn
You can choose if your money in the ISA will be invested into one of three funds – Cautious, Balanced and Adventurous, which is a diverse portfolio made up by investment managers. These cost 0.75% per year, so £5,000 invested will cost £37.50 over a year.
The money in savings will earn a total of 6.65% over the year, as long as both the money in the savings account and money in the Stocks and Shares ISA remain — this will earn you £312.50 in interest if you have £5,000 saved. If you have more in your savings than your ISA, you’ll only earn the higher rate on up to the same value.
Your investments aren’t guaranteed to rise — there have been years that they’ve fallen in value, and other years where they’ve performed particularly well — don’t invest any money you aren’t prepared to lose. General guidance is that you should be prepared to invest for at least five years. Here are some possible outcomes:
Your investments earn nothing
If your investments were to earn nothing over the year, you’d earn a total of £295 on the combined £10,000, or 2.95%.
| Savings | Investments | Total | |
| Amount saved/invested | £5,000 | £5,000 | £10,000 |
| Performance | +6.25% | 0% | Essentially 2.95% on full amount |
| Fee | £0 | £37.50 | £37.50 |
| Total | £312.50 | -£37.50 | £275 |
Your investments rise by 5%
If your investments were to rise by 5%, you’d earn £545 on the combined £10,000, or 5.45%.
| Savings | Investments | Total | |
| Amount saved/invested | £5,000 | £5,000 | £10,000 |
| Performance | +6.25% | +5% | Essentially 5.45% on full amount |
| Fee | £0 | £37.50 | £37.50 |
| Total | £312.50 | £212.50 | £525 |
Your investments fall by 5%
If your investments were to fall by 5%, you’d earn £45 on the combined £10,000, or 0.45%
| Savings | Investments | Total | |
| Amount saved/invested | £5,000 | £5,000 | £10,000 |
| Performance | +6.25% | -5% | Essentially 2.95% on full amount |
| Fee | £0 | £37.50 | £37.50 |
| Total | £312.50 | -£287.50 | £25 |
Is it worth it?
This is worth a look if you plan to invest this much already, but it’s likely not worth doing just for the savings rate if you’re nervous about investing, as you essentially lock away twice the amount for the sake of a savings rate on just half of that.
If you plan to take up this offer, you should keep in mind that these are ready-made portfolios, so you don’t choose individual investments and you pay a fee of 0.75% for the management of the account and investments.
You can transfer in your ISAs too, so if you already have a Stocks and Shares ISA elsewhere, it can be transferred to Virgin Money to get you access to the rate on your savings.
