Personal accounts
Business accounts
Charity accounts
Overview
Personal accounts
High interest current accounts have become the go to accounts for savers as standard savings account rates have plummeted to record lows. However, these accounts do come with conditions, so aren’t simple; but they should allow easy access and used wisely are the best way to earn the highest interest rates in the current climate.
Pros/Cons
They offer easy access with some of best interest rates on the market, in some cases more than three times the best standard easy access rates.
They can be restrictive. You must comply with the strict terms and conditions to benefit and may include a monthly fee.
Tips
Setting up standing orders is an easy way to ensure you deposit and withdraw the qualifying amounts each month. Some of these accounts also offer exclusive linked savings accounts which can pay competitive rates.Easy Access Accounts are variable rate accounts that allow you to withdraw cash when you need it. As a result, sometimes the interest rates may be lower than those on other types of savings account such as notice accounts or fixed rate bonds.
Pros/Cons
Withdraw cash without notice or penalty
Accounts may not always be that simple. Some come with restrictions, short term bonuses and hefty penalties should you make too many withdrawals
Tips
If your account comes with a short term bonus, make sure you move the money when the bonus expires or better still, add the account to Rate Tracker and we'll remind you when to move. If you pay tax on savings, it's sensible to use your ISA allowance first if you haven't used it elsewhere.These require a set amount of notice, usually 30 to 180 days, in order to access your money.
Pros/Cons
For those savers happy to give notice to access their money, sometimes you can be rewarded with better rates.
Some accounts will allow earlier access with an interest penalty, but not all, so check the terms and conditions carefully if you think you might need funds in an emergency
Tips
It can be better not to be able to dip into your cash immediately, instead having to plan ahead. But keep an eye on the rates and remember to give notice as soon as possible if the rate becomes uncompetitive, or add it to Rate Tracker and we'll let you know if the rate changes. If you pay tax on savings, it's sensible to use your ISA allowance first if you haven't used it elsewhere.Fixed Rate Bonds offer a fixed rate of interest for a fixed period of time, normally 1-5 years.
Pros/Cons
A fixed interest rate means you’ll know exactly what income you’ll receive from the outset
You’re locked into the rate for the term, therefore should interest rates rise, the rate you hold may become uncompetitive
Tips
Although some of the best rates on the market tend to be for longer terms such as 3 to 5 years, locking in for this length of time does carry its own risks, so make sure you're happy to have no access until maturity. Add your fixed rate products to Rate Tracker and we'll remind you when your bond is due to mature. If you pay tax on savings, it's sensible to use your ISA allowance first if you haven't used it elsewhere.Pros/Cons
They are tax-free!
You are restricted on the amount you can deposit.
Tips
If you're not looking to use any other ISA allowances, a cash ISA should be any tax paying savers first port of call. If you're looking to switch your ISA to another ISA provider, always approach your new provider to arrange the switch for you, never withdraw the cash as that part of your allowance will be lost forever. Make sure you're always keeping your tax-free savings as healthy as possible.Pros/Cons
They are tax-free!
You are restricted on the amount you can deposit.
Tips
If you're not looking to use any other ISA allowances, a cash ISA should be any tax paying savers first port of call. If you're looking to switch your ISA to another ISA provider, always approach your new provider to arrange the switch for you, never withdraw the cash as that part of your allowance will be lost forever. Make sure you're always keeping your tax-free savings as healthy as possible.Cash ISAs are simply tax free savings accounts which come in all sorts of shapes and sizes; you can save up to £20,000 in the current tax year.
Pros/Cons
They are tax-free!
You are restricted on the amount you can deposit.
Tips
As with any Fixed Rate Account, to gain access early there is usually a hefty penalty and in some rare cases, early access is simply not allowed. Add your fixed rate ISA to Rate Tracker and we'll remind you when it's due to mature. If you're looking to switch your ISA to another ISA provider, always approach your new provider to arrange the switch for you, never withdraw the cash as that part of your allowance will be lost forever.Many accounts offer monthly interest for those who need to boost their income.
Pros/Cons
For those looking for a regular income from their savings
Rates are normally a little bit lower than if you can leave the money to earn annual interest
Tips
Remember that if you draw out the income each month, the value of the cash you put away in the first place will not rise at all, so is being eroded by inflation. Whether it's a fixed rate bond or a variable rate account, add your account onto Rate Tracker and we'll remind you when your rates change.These allow you to deposit regular amounts each month to build up a lump sum. But make sure that you know the terms and conditions, as if you don't comply the rates can drop dramatically.
Pros/Cons
Often these offer some of the best interest rates on the market
Best rates are usually restricted to 12 months with low maximum month deposits permitted
Tips
If you have a lump sum to invest, you could open a best buy easy access account and drip feed money each month into a top paying regular savings account to gain a little more interest. Many of the top paying accounts only last for one year, so don't forget to add it to your Rate Tracker portfolio and we'll remind you when it's time to switch.Designed solely for children, these accounts come in all shapes and sizes, much like adult accounts.
Pros/Cons
Kids have their own personal allowance so can earn interest tax free
There are often restrictions on the amount you can save.
Tips
Don't forget the £100 rule on gifts from parents; any gross interest earned over £100 per year on gifts from parents will be taxed at the parent's highest rate.A type of tax-free savings account which is opened on behalf of a child. Accounts can be topped up by parents, friends and family up to a limit of £9,000 in the current tax year.
Pros/Cons
They are tax-free! Money in the account belongs to the child.
You are restricted on the amount you can deposit and funds cannot be accessed until the child reaches 18 years old.
Tips
Originally available to children born on or after 3 January 2011, born before September 2002 or those that didn't qualify for a Child Trust Fund Account, since April 2015 anyone with a Child Trust Fund could transfer it to a Junior ISA as well. Junior ISAs are opened by a parent or legal guardian on behalf of a child, with the money in the account belonging to the child, although it cannot be withdrawn until they turn 18. Parents, friends and family can all contribute to the Junior ISA, as long as it stays within the limit, so it can be a great way of building up funds for the future.A type of tax free savings account available to all savers aged between 18 and 40. Up to £4,000 can be saved annually and the Government will pay a 25% bonus, i.e a bonus of up to £1,000 each year. The bonus can be used to buy your first home or for your retirement.
Pros/Cons
They are tax-free! A government bonus is added monthly.
You are restricted on the amount you can deposit and there is a maximum bonus amount.
Tips
Lifetime ISAs are not limited to one per home, so a couple who are buying a property together can each recieve a bonus on the same property. If you do not use the funds and bonus for a deposit on a first home, funds can be taken out tax free and without penalty after your 60th birthday. Lifetime ISAs can be used in addition to a pension, so individuals can contribute to both.Sharia compliant savings accounts comply with Islamic law but are available to any saver, regardless of religion or culture. Sharia law states that money had no intrinsic value, so neither party can profit from an exchange of money, therefore the payment and receipt of interest is forbidden. Instead, Sharia compliant accounts pay an 'Expected Profit Rate' as an alternative to interest, which is the level of profit paid by the provider to the saver. The provider invests the money deposited by savers to generate a profit, so there is an inherent risk involved, as the return received depends on the performance of the investments made by the provider. Having said that, providers are keen to state that Expected Profit Rates are usually achieved and most providers allow you to take funds away early if the Expected Profit Rate is not likely to be achieved.
Pros/Cons
Some of the rates on offer are higher than on standard savings accounts
Returns are based on an Expected Profit Rate, rather than guaranteed Interest
Tips
Some of the rates on offer are better than those offered on standard savings accounts, though the return is not guaranteed in the same way as interest. Make sure you are happy with how the Expected Profit Rate is generated and paid and it is also worth looking at the provider's track record in achieving profit rates in the past. Always ensure that providers are covered by the Financial Services Compensation Scheme (FSCS) or equivalent and if you have any concerns, keep within the protection limits.Business accounts
Pros/Cons
Withdraw cash without notice or penalty
Accounts may not always be that simple. Some come with restrictions, short term bonuses and hefty penalties should you make too many withdrawals
Tips
If your account comes with a short term bonus, make sure you move the money when the bonus expires.Pros/Cons
A fixed interest rate means you’ll know exactly what income you’ll receive from the outset
You’re locked into the rate for the term, therefore should interest rates rise, the rate you hold may become uncompetitive
Tips
Although some of the best rates on the market tend to be for longer terms such as 3 to 5 years, locking in for this length of time does carry its own risks, so make sure you’re happy to have no access until maturity.Pros/Cons
For those savers happy to give notice to access their money, sometimes you can be rewarded with better rates.
Some accounts will allow earlier access with an interest penalty, but not all, so check the terms and conditions carefully if you think you might need funds in an emergency
Tips
It can be better not to be able to dip into your cash immediately, instead having to plan ahead. But keep an eye on the rates and remember to give notice as soon as possible if the rate becomes uncompetitive.Charity accounts
Pros/Cons
Withdraw cash without notice or penalty
Accounts may not always be that simple. Some come with restrictions, short term bonuses and hefty penalties should you make too many withdrawals
Tips
If your account comes with a short term bonus, make sure you move the money when the bonus expires.
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