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Five Days in Monterey, the Center of the Automotive Universe
Five Days in Monterey, the Center of the Automotive Universe

Bloomberg

time7 hours ago

  • Automotive
  • Bloomberg

Five Days in Monterey, the Center of the Automotive Universe

Ahoy from Monterey Car Week, a car lover's nirvana, where the only things louder than the combustion engines rumbling in the cool morning fog are the blazers on some of the gentlemen on the lawn of the Quail, A Motorsports Gathering. It's Hannah Elliott, and I've been on California's central coast since Wednesday, interviewing car executives and eating my way through the Italian restaurants of Carmel. (Go to Casanova.) Oh, and driving. Lots of driving.

Digital bank blasted over 'diabolical' savings change: 'Big reason we signed up'
Digital bank blasted over 'diabolical' savings change: 'Big reason we signed up'

Yahoo

time4 days ago

  • Business
  • Yahoo

Digital bank blasted over 'diabolical' savings change: 'Big reason we signed up'

Young Aussies are threatening to leave Up Bank after the popular bank announced it would introduce a new savings system from September. Up Bank is Australia's first mobile-only digital bank and has more than one million, mostly Gen Z and Millennial, customers. Up Bank, which is a subsidiary of Bendigo Bank, currently allows customers to earn a flat 3.85 per cent interest rate on all savings accounts. But from September 1, it will introduce a new system, 'Glow & Flow,' where customers can earn a higher 4.85 per cent interest rate if they don't touch their funds. If they make a withdrawal, that rate will drop to just 1.5 per cent. Hannah Elliott has been a customer of Up Bank for the last five years and told Yahoo Finance she was 'genuinely shocked' when she heard about the change and was now considering changing banks. RELATED Major warning after Aussie receives random $350 payment in her bank account Centrelink warning for downsizing Baby Boomers over 'special' retirement rule Westpac CEO admits bank was 'wrong' about branch closures 'Up Bank have always marketed themselves as an 'envelope system' style bank - a big reason so many of us joined in the first place," the 27-year-old said. "What they're proposing now completely undermines that approach." The 'envelope system', also known as 'cash stuffing', is a popular budgeting method where you divide your money into different categories or envelopes for different spending purposes, such as rent, groceries and household bills. Many Up Bank customers have said they used the bank's savers as a digital envelope system since they can open up to 50 saver accounts and earn interest. Elliott said this had 'transformed' the way she spent and saved her money. 'Personally, around 75 per cent of my 'savers' will only receive the lower flow rate of 1.5 per cent because I transfer out of them at least monthly,' she said. 'Up Bank already offered a slightly lower interest rate than competitors, and I was happy to accept that in exchange for their brilliant features. But now, it feels like we're being punished rather than supported. 'Sure, I could change my system to chase the higher Grow rate, but I've spent years building a setup that works perfectly for me and my brain. I've never had to adjust it in the past five years - until now.' Up Bank defends unpopular change An Up Bank spokesperson told Yahoo Finance it had introduced the new system to help customers 'maximise their savings potential, while also keeping the flexibility to access their money when they need it'. The bank said it wanted to help customers improve their financial wellbeing for the 'long haul', not just today, and argued the 'old system wasn't cutting it anymore'. It said the old system meant there was no incentive to split money between short- and long-term goals. It also noted it meant they couldn't offer stronger rates to customers wanting to grow their savings over time, and the system just wasn't 'sustainable' long-term. Mozo personal finance expert Kylie Moss told Yahoo Finance the change would 'ruffle some feathers' amongst existing customers. She said the one 'upside' to the change was that customers could earn a higher interest rate provided they met the more restrictive conditions. But this may take more mental gymnastics on the customer's part. 'The key to getting the highest interest returns will now be towards splitting Savers between Grow, medium-long term savings goals and closer management of Flow accounts to keep the balance in these accounts at a 'goldilocks level' - not too high they miss out on the higher interest, but not too low they regularly draw on funds in Grow accounts,' Moss said. 'Whether savers earn more or less on their savings will come down to how well customers shift their saving and spending behaviour to suit the new dual account set up.' 'So disappointed': Aussies threaten to switch banks A number of Up Bank customers have taken to social media to blast the change, with some labelling the change 'diabolical' and others a 'slap in the face' and threatening to change banks. 'The reason I've used Up is because of the multiple savings accounts and good interest rate … I'm looking elsewhere now,' one customer wrote. 'I've been with Up for many years and recommended them to a LOT of people... but this change completely flies in the face of the values that most of us came for, and stayed for. They'll lose a lot of customers over this - plus it really doesn't help any of us budget/save in a cost-of-living crisis,' another said. 'Time to get out! This isn't what we joined for,' a third said. Elliott said she was considering switching banks, but the problem was she couldn't find the same features elsewhere. 'No competitor offers both unlimited savers and paycheque splitting, for example. So now I have to choose what to compromise on: the flow rate, or the features I value most,' she said. Moss noted Up Bank was one of the few banks that allowed for multiple savings buckets or envelopes. 'It also has a lot of unique features available to help customers manage their cashflow and stay on top of savings goals like trackers, covers and auto transfers,' she said. BOQ's Future Saver account for 14 to 35 year olds currently offers the top ongoing savings rate on Mozo's database at 5.10 per cent. Customers can open up to 9 accounts for different savings goals. Westpac's Life account for 18 to 29 year olds has a 5 per cent bonus rate for customers who meet conditions. You can open up to six savings goals. ING Savings Maximiser offers a 5 per cent interest rate, but only one account is eligible for the bonus rate, while MOVE Bank's Growth Saver also offers a 5 per cent but you can't earn interest on multiple accounts.

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