Written by Karen Bryan
I’m not a great fan of premium current accounts, where you pay a monthly fee in order to receive benefits; usually various types of insurance. I’d prefer a pick and mix approach, allowing customer to select the products that best suit their needs. However, when I was researching the Nationwide Flex Direct current account, I noticed that there’s also a Nationwide Flex Plus current account.
The Nationwide Flex current account charges £10 a month and includes annual travel insurance, mobile phone insurance, UK & European breakdown cover and a 12 month warranty extension on electrical goods.
It’s hard to work out the value of these benefits. We get annual travel insurance as part of our Direct Line Home Insurance Plus and UK & European Breakdown cover is included in our Marks and Spencer Premier Car Insurance. I try to be very careful with my mobile phone and have never lost one or had one stolen, plus my I use basic smart phones which cost around £100. I get a 12 month warranty extension with my BarclayCard World Mastercard, which is not very useful as you have to get a quote for repairs before you can claim.
Part of the Nationwide Flex Plus £120 a year charge can be offset if you keep a balance of £2,500 in the account, which pays a 3% variable rate of interest. That would earn you £75 a year gross (£60 net after deduction of 20% basic rate income tax). The highest rate of interest you could get on an instant access account is around 1.7% which would earn £42.50 gross interest (£34 after deduction of basic rate income tax). The additional net interest earned would equate to reducing the annual fee on the Nationwide Flex Plus current account to £84.
Nationwide Flex Plus account holders have access to some exclusive product deals, e.g. personal loans at a lower rate of interest. This could possibly save you money, but you’d have to compare the exclusive products with what was on offer from other financial institutions.
I doesn’t appear that the Nationwide Flex Plus current account is very suitable for our needs, but the additional benefits might offer value for money for some customers.