Interest rates have never been lower. In fact, rather than paying interest on deposits, in certain circumstances banks are now charging for holding their customers money. Add in the impact of inflation, increasing at a rate not seen in decades, and clearly money held in traditional deposit accounts is falling in value in real terms.

In Ireland negative interest rates hit the headlines a couple of years ago when Bank of Ireland announced it was charging pension funds for holding their cash. Other banks followed suit, announcing similar charges for large corporate and business deposits, with rumours that large personal deposits were next in line. Credit unions are charged for lodging their own customer funds with the banks, and that is a factor in many of them putting upper limits (max €30,000) on individual deposits from their members (please check with your local Credit Union on their maximum deposit limit).

From the banks perspective they are simply passing on their costs – the European Central Bank (ECB) overnight deposit facility rate is currently -0.5% – so it is costing them to park their excess funds. Until recently there had been little indication that these rights might change. Rising inflation may have an impact if the ECB pushes interest rates higher.

So, what are the alternatives to deposit accounts? With interest rates likely to remain low for several years it has never been more important to make yourself aware of the options available to you. Investment funds and saving plans from the major life assurance companies are real alternatives for small and largescale savers alike. They are also an option for corporate and business deposits. (

These products invest in funds which include shares (equities) in various markets, government bonds, property etc. to generate a return. The funds vary in terms of how they are managed, their aims and their risk profile. Selecting the right product and fund to meet your needs is critical and requires independent financial advice.

At MLMG Financial Brokers we have over 50 years combined experience of giving investment advice to our clients. If you would like further information or to discuss the options available to you then please contact a member of our team today on 0749324120 or email