For an emergency fund, you need an account that lets you access your money whenever you need to. Instant or easy access accounts let you to deposit or withdraw cash as you see fit. There may be a short delay of a day or two to complete withdrawals with easy access accounts, but otherwise they are the same as instant access accounts. Be aware that some banks may asked for 24 hours notice for withdrawing amounts above £1,000.
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Best savings rates today - last updated Nov 7 2024
The highest interest rates for our top savings accounts available in the UK. This list is updated daily and it includes promoted products, so the highest interest rates could be further down the table.
| Product type | AER | |
|---|---|---|
| Instant access savings | 5.00% | |
| Notice savings | 5.05% | |
| Cash ISAs | 5.17% | |
| 1 year fixed rate bond | 4.70% | |
| 5 year fixed rate bond | 4.40% | |
| Fixed rate bond | 4.90% |
Do I need a savings account?
A savings account isn't compulsory but it can be useful tool for managing your finances to achieve your goals. For example, if you would like to buy a house one day, a savings account can help you to reach this milestone as it encourages you to budget effectively and put money away each month. It's recommended that at least 20% of your income should be saved and a savings account is a safe place to store this money.
However, the biggest bonus of a savings account is that you also earn interest on your savings. In the past year, interest rates on savings accounts have risen, with many above inflation and this gives your money more purchasing power. Inflation is currently at 3.40%, and the average monthly interest on savings accounts is 4.10%. So, if your savings are currently sitting in an account earning little to no interest then you could be missing out on some extra cash.
The savings account market is also always changing, especially when the Bank of England adjusts the base rate, so it's important to compare all savings accounts to find the best deal for your money. Currently, the base rate remains at 5.25% which is the highest it's been for 16 years, and is one of the reasons why interest rates are higher on savings accounts.
Average savings rate vs base rate over time
An illustration of how savings rates have changed in relation to the Bank of England base rate over the two past years. The average rates have been calculated by taking the rates from the whole of market at the time of the base rate change. Source: Defaqto and Bank of England data.
Which is the best savings account for you?
If you're building an emergency fund...
For an emergency fund, you need an account that lets you access your money whenever you need to. Instant or easy access accounts let you to deposit or withdraw cash as you see fit. There may be a short delay of a day or two to complete withdrawals with easy access accounts, but otherwise they are the same as instant access accounts. Be aware that some banks may asked for 24 hours notice for withdrawing amounts above £1,000.
If you want to put away money regularly...
If you're looking to save money regularly, but don't have a specific goal in mind, a cash ISA lets you add up to £20,000 a year to your nest egg. The better news is that any interest you earn with these is also protected from tax.
If you're trying to save for a large purchase...
If you're looking to buy a car or pay for a future holiday, you'll likely want an account that allows you to put away money that you can't access unless you absolutely need to. In this case, notice savings accounts may have you covered.
These accounts will allow access to funds saved, although you may have to wait for 30 days to up to 120 days to make a withdrawal. However, you typically get higher interest rates on notice accounts compared to easy-access accounts.
If you don't need the money right away...
The go-to option if you’re serious about earning interest on your savings, but won't need the money for a while, is a fixed-rate bond. These pay about the best interest available, but mean you have to commit to locking your money away for a set period. The longer the term of the bond, typically, the higher rate you'll get.
Which is the best savings account for you?
If you're building an emergency fund...
If you want to put away money regularly...
If you're looking to save money regularly, but don't have a specific goal in mind, a cash ISA lets you add up to £20,000 a year to your nest egg. The better news is that any interest you earn with these is also protected from tax.
If you're trying to save for a large purchase...
If you're looking to buy a car or pay for a future holiday, you'll likely want an account that allows you to put away money that you can't access unless you absolutely need to. In this case, notice savings accounts may have you covered.
These accounts will allow access to funds saved, although you may have to wait for 30 days to up to 120 days to make a withdrawal. However, you typically get higher interest rates on notice accounts compared to easy-access accounts.
If you don't need the money right away...
The go-to option if you’re serious about earning interest on your savings, but won't need the money for a while, is a fixed-rate bond. These pay about the best interest available, but mean you have to commit to locking your money away for a set period. The longer the term of the bond, typically, the higher rate you'll get.
Is my money safe?
The Financial Services Compensation Scheme (FSCS) guarantees that the first £85,000 you have saved with a UK-authorised bank or building society (or the first £170,000 for a joint account) will be safe even if the business goes bust.
Our best instant access cash ISA
Our editors picked this deal by weighing several factors for each product, including the interest rate, withdrawal conditions, minimum opening balance and more.
Chip Clearbank - Cash ISA
Instant access
Term
4.84%
AER BBR tracker
£1
Open with
FSCS
Protection scheme
How we score our products
Expert verdict
Lucinda O'Brien, our savings expert says..
"Chip Clearbank's cash ISA is another great option if you're just starting your savings journey. At 4.84% AER BBR tracker the interest rate is competitive and you can start saving with just £1.
Being instant access, you can make a withdrawal whenever you need to, and because it's in ISA, any interest you earn won't count towards your personal savings allowance.
"
Pros and cons
Pros
Cons
Account details
No notice, penalty, or charge applies.
Eligibility
Maximum Age
Unlimited
Minimum Initial Deposit
£1
Permanent UK Resident
Our best easy access savings account
We picked this deal by weighing up factors such as the interest rate, withdrawal conditions, and minimum opening balance for this product.
Clearbank - Chip Easy Access Saver
Any amount
Minimum
5%
AER variable inc. 0.93% fixed bonus for 12 months
FSCS
Protection
Easy access
Account
How we score our products
Expert verdict
Lucinda O'Brien, our savings expert says..
"Chip's easy access account has a competitive interest rate at 5% AER variable inc. 0.93% fixed bonus for 12 months. Plus, if you need a savings account that has instant deposits and withdrawals it ticks a lot of boxes. However, bear in mind that if you make more than three withdrawals in 12 months the interest rate will decrease, so this account works best if you won't need to dip into your savings frequently."
Pros and cons
Pros
Cons
Account details
If more than 3 withdrawals are made in each 12 month period from account opening, the underlying interest rate will reduce; the introductory bonus will remain during the first 12 months and will not be lost if more than 3 withdrawal are made. For example if more than 3 withdrawals are made in the initial 12 month period the rate will reduce to 3.90% AER (2.97% 0.93%), if more than 3 withdrawals are made in the 12 month period after the introductory bonus has ended the rate will reduce to 2.97% AER. The withdrawal period resets each 12 months on the anniversary of account opening, the rate will return to the higher interest rate and the 3 withdrawal limit is reset.
Eligibility
Maximum Age
Unlimited
Maximum Initial Deposit
£1,000,000
Permanent UK Resident
Our best notice savings account
Our editors picked this deal by weighing several factors such as the interest rate, term, withdrawal conditions, minimum opening balance and others for this product.
RCI Bank E-Volve Savings 14 Day Notice Account
£100
Minimum
4.65%
AER variable
FSCS
Protection
14 days notice
Account
How we score our products
Expert verdict
Lucinda O'Brien, our savings expert says..
"RCI Bank's notice account offers savings in support of a good cause, as all deposits will be used to fund pure electric vehicles and charging.
With notice, this account also offers gives a slightly better rate than you'd get with an instant access. So if you know you won't need to withdraw money right away, and you're keen on ethical investing, this is a good option."
Pros and cons
Pros
Cons
Account details
Withdrawals and closure permitted subject to 14 days' notice.
Eligibility
Maximum Age
Unlimited
Minimum Initial Deposit
£100
Maximum Initial Deposit
£1,000,000
Permanent UK Resident
Our best one-year fixed rate bond
Our editors picked this deal by weighing several factors such as the interest rate, term, withdrawal conditions, minimum opening balance and others for this product.
Raisin UK BACB - 12 Month Fixed Term Deposit
1 year
Term
4.7%
AER fixed
£1,000
Open with
FSCS
Protection scheme
How we score our products
Expert verdict
Account details
No withdrawals or closure permitted during the term of the account.
Eligibility
Maximum Age
Unlimited
Minimum Initial Deposit
£1,000
Maximum Initial Deposit
£85,000
Permanent UK Resident
Pros and cons of savings accounts
Pros
They're easy to open
You can earn high interest so your money grows
Some types of accounts allow you to access your money easily
You can open some savings accounts with just £1
Your money is protected by the FSCS
Cons
Any returns you get through interest are relatively moderate
Some types of savings accounts penalise you for withdrawals
Interest rates can fluctuate depending on the BoE base rate and savings providers' needs
How do I open a savings account?
The good news is that it's fairly easy to open a savings account - and you can have as many as you want. In fact, it's a good idea to have a few different types to maximise your savings. For example, you might want an easy or instant access account for an emergency fund, but a fixed-rate account for long-term savings goals.
Most providers allow you open it online, by phone or in branch but bear in mind some accounts have to be opened in specific ways. To open a savings account, you'll need to provide ID and proof of your address so the bank can do its relevant checks. The provider will also ask for an initial deposit to open the account and this can start from just £1.
FAQs
What is a savings account?
Savings accounts are types of accounts with a bank or building society where you put away money to earn a return through interest. While the interest you earn on many savings accounts can be relatively modest, they provide a safe and reliable place to stash your money for short term needs. They’re especially useful if you’re looking to build an emergency fund, or for short-term savings goals like buying a car or a holiday. Read more about how savings accounts work.
What is our highest rate for a savings account?
Our best interest rate for a savings account is currently 5.17%.
Is your money safe in a savings account?
The Financial Services Compensation Scheme (FSCS) provides £85,000 of protection for each person who has saved money in a registered bank or building society in case it goes bust. This rises to £170,000 for joint accounts.
So, if you’re a single person with £170,000 in savings, you could protect the full amount by putting £85,000 in two separate accounts held by different savings providers.
But keep in mind that many banks operate under shared licences, for example HSBC and First Direct, which means you are only protected up £85,000 even if you have accounts in both banks.
Do I have to tie my money up to save?
No, you can choose how much access you have to your money by choosing the right savings account.
Can I get a joint savings account?
Yes, most savings accounts can be set up in joint names, so you should be able to do this if you’d like to save with someone else.
Where can I put my money to earn the most interest?
If you would like to earn the maximum amount of interest then you will need to compare savings accounts. Generally, fixed-rate accounts have higher interest rates in exchange for locking away your money for a fixed amount of time. But there will be some exceptions, so the key to finding the most interest is research.
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References
1. Bank of England Money and Credit report - July 2023