Savings Account

There are a variety of savings accounts available to suit individual needs.

Types of savings accounts include:

  • E-Savings Accounts – small opening balance required, no notice of withdrawal needed and no need to ensure that regular payments are made.
  • ISAs – Tax-free savings accounts which come in many forms. The most common is the mini-ISA which has a limit of GBP 3 000 which can be invested in any one year.
  • Interest is usually tiered i.e. paid at a lower rate for smaller investments and at a higher rate for larger sums.
  • Standard Savings Account – No minimum investment, instant access and often, a cash card. (Variations on this account include offering a more favourable interest rate for fewer transactions.)
  • Standard-Plus Savings Account – A minimum amount has to be invested and instant access is available, all paying a higher rate of interest.
  • Savings Account only available to the holders of certain accounts within the bank – Higher minimum opening deposit, and instant access. This has a higher still rate of interest paid into it.
  • Savings Account where 90 days notice has to be given before withdrawals are made – Typical opening balance of GBP 5 000 must be invested, with a very favourable rate of interest.
  • Guaranteed Equity or Fixed Rate Bond – Typically tie up money for two or three years with a minimum investment of GBP 5 000. Gives a comparatively high rate of return. Bonds are linked to stock-market performance.
  • Five Year Children’s Bonds – Tie up the savings for five years and, typically, require at least GBP 1 000 to be invested.
  • Smaller Bond – Typically GBP 500 and money is only tied up for a year.
  • Savings Account for Young People – Minimum investment is GBP 1 and instant access is available.
  • Child Trust Fund – The government give GBP 250 into a child’s account for those born after 1st September 2002. Parents and friends can add to the account (often with a ceiling of GBP 1 200 per year) and the child can not withdraw any monies before they are 18.
  • Term Deposit Accounts – Minimum amount has to be deposited for a set period, typically, six to 36 months.
  • Guaranteed Tracker Accounts – Account follows the Bank of England base rate. A minimum deposit is required.
  • Savings Account – where there is a minimum paid in each month.

Savings accounts and investments are closely related. What’s the difference?

  • Savings accounts produce a steady and certain return
  • Investments can go up as well as down.

Savings account links