Supermarket Xmas Boost
Earn a year's interest (up to 6%) in a day
Many supermarkets urge you to save for up to 6% bonuses in their (not UK-protected) savings-stamps schemes.
Yet the bonuses are often paid solely based on what you've got saved up on a set date - so it's possible to bag a year's interest in a day. This is a rundown of schemes from Asda, Tesco, Morrisons and more.
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How supermarket savings stamp schemes work
Supermarket savings stamp schemes encourage year-long saving for Christmas, yet a loophole allows you to get the year's bonus in just one day.
Most supermarkets pay out the bonus based on how much you’ve saved by a specific day or month, so dunk the cash in just before and they’ll add up to 6% on top. Unlike normal savings accounts, you're paid a bonus based on the total amount saved on the bonus day.
The savings themselves come in the form of booklets or electronic cards which you can top up a little at a time. Some supermarkets only allow stamps to be redeemed at set points in the year, while others will let you spend at any time.
Don't think of this as a gift
It isn't the supermarkets being generous, it's good business acumen. You save for a year, they earn interest on your money, and eventually give you a little back. And more importantly:
You must spend the cash at that specific retailer, so they effectively lock in your custom.
You won't be surprised to hear there are some exclusions on what you can buy with the stamps - you can't usually spend them on lottery tickets, petrol or goods from third party concessions (when a retailer has a space in a larger department store). Some supermarkets also don't allow you to redeem them online.
How safe are supermarket savings schemes?
It's important to understand these DO NOT have the same protection as savings in a bank (supermarket bank savings do though, eg, Tesco Bank - see the Safe Savings guide for more). In fact, this is exactly what happened with the Farepak debacle back in 2006. It's the reason we've always cautioned against savings clubs.
If saving for Christmas over the year - a fantastic aim - save in the bank (see Top Savings Accounts and Top Cash ISAs). Then withdraw it and buy savings stamps the day before the bonus date to bag double interest.
As this technique's about keeping a small sum of cash on the cards for just a couple of days, the risk's reduced. The chance of a big supermarket going bust in that time is pretty slim, though nothing's impossible.
The loophole
Supermarkets tend to pay the bonus on a specific day or month, normally during November or December. The bonus earned only depends on how much is in there, not how long it's been there. Therefore, you can simply...
Buy all the stamps/credit required just before the bonus date, get the full bonus, then use the funds to shop.
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Top Christmas 2018 schemes
Up to 5% - cash in at any time
Iceland's electronic Bonus Card savings scheme runs year-round. For every £20 you save, you get £1 free which you can spend at any point.
The £1 bonus is paid regardless of the time of year and arrives in your Bonus Card savings account within 48 hours of hitting the £20 trigger. You can save up to £1,000 per card - you'll get the £1 bonus for every £20 top-up (equal to 5%).
Up to 4% bonus - pays out once a year
Asda's Christmas Savings Card scheme pays a £1 bonus if you save between £49 and £96, a £3 bonus for between £97 to £143, and those with £144 get a £6 bonus (equal to 4%). There's a limit of £144 per card but you can have multiple cards.
You can start the card at any point and you've got until 5pm on Sun 18 Nov to add the maximum credit to get the bonus. The bonus will be credited by 8am Mon 19 Nov 2018.
4% bonus - pays any day in Dec
The savings scheme from the Co-op is a paper savings stamp card. You get £50 off your shopping bill if you use a completed card (£48 worth of stamps) to pay for your shopping in December. This bascially means you'll get £2 off a £50 shop (equal to 4%). You won't get the bonus if you save any less or spend the card at any other time of year.
There's a £48 max per card but you can collect as many cards as you like so if you're likely to save more, you'll need a new card. The cards have no expiry date and you can top them up throughout the year.
Up to 3% - pays out in Nov/Dec
Morrisons Christmas Savers is a digital savings stamps scheme where you buy stamps for £1 a time. It pays a £1 bonus if you buy between £49 and £96 of stamps, a £3 bonus for between £97 to £145, a £4 bonus for between £146 and £193 and those with £194 get a £6 bonus. You'll need to buy your stamps by 31 October 2018 to get the bonus, which you can spend between 5 November and 31 December. You'll be given your balance in the form of vouchers, which you can spend in-store or on the Morrisons grocery website.
Up to 6% - pays out in Nov
Tesco's Christmas Saver scheme is an extension to the Clubcard scheme, where you can choose to save up all your Clubcard vouchers for the year and get a bonus in your November statement if you top-up your savings. It pays a £1.50 bonus if you top-up between £25 and £49.50, a £3 bonus between £50 and £99.50, a £6 bonus between £100 and £199.50 and a £12 bonus between £200 and £360.
You've got until 16 Oct 2018 to top-up and get the bonus in your November statement. Bonus vouchers are valid for two months from the date of issue.
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