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24.5m transactions worth £1.4bn will be spent on plastic cards today

Source: Credit Action January 2008 (www.creditaction.org.uk)

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Savings Accounts

If you are saving money over a long period of time the enemy is inflation which makes the money that you have worth less in real terms over time. Money left in a box under the bed will not buy you as much in 5 years as it will today, not to mention the obvious insecurity. To combat inflation, savings accounts pay interest on the money that you save. The higher the interest rate the more money you are paid and the better you are protected against inflation. Read more...>


Best deals for Savings Accounts

  Notice or Term AER  
Icesave Fixed Rate

Icesave Fixed Rate

A high fixed interest rate of 7.01%
6,12,24 or 36 mths 7.01%
Cahoot Fixed Rate Bond

Cahoot Fixed Rate Bond

6.87% AER interest rate until 30th Oct 2008 - Limited Offer
30th October 2008 6.87%
Abbey Instant Access Saver

Abbey Instant Access Saver

Manage your savings via phone or branch
Instant Access 6.50%
Birmingham Midshires eSaver

Birmingham Midshires eSaver

Unlimited deposits and withdrawals without losing interest
Instant Access 6.50%
Icesave Easy Access

Icesave Easy Access

Easy online access 24 hours a day
Instant Access 6.30%
Saga Online Top 5 Tracker

Saga Online Top 5 Tracker

6.25% AER, interest paid monthly or yearly
Instant Access 6.25%

The lowest rates of interest are paid on current accounts and that is why customers look to move their money to special savings accounts. The natural assumption for anyone choosing a savings account would be to look for the highest interest rate on the market but unfortunately there are always other factors to consider. Even though you are saving money you may want easy access to it and the general rule of thumb is that the longer you can agree to not touch your savings the higher rate you can get. Other considerations will be the amount of money that you are saving, as larger amounts also tend to attract higher rates.

If you want your savings account to give almost as much instant access to your money as a current account then you will get a lower rate than if you are able to commit to having no access to your money for a period of perhaps 5 years. 

The rate shown with most savings accounts is the Annual Equivalent Rate (AER) which is very useful for comparisons.  The AER takes into account any temporarily high introductory offer that may drop away and it also includes the effects of compounding on your interest over months to give you the true rate of return that you will see by the end of the year.

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News

Bank rate kept at 5%
Bank rate kept at 5%

08-May-08

Monetary Policy Committee (MPC) holds UK interest rates this month
Bank reduces interest rates by 0.25%
Bank reduces interest rates by 0.25%

10-Apr-08

Bank of England MPC reduce interest rates 5.0%

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