Log in Register Get started Savings accounts Bonus About Help & info Savings accounts Interest rates up to 2.05% AER at Raisin UK Safe: Deposits are always protected by the relevant deposit guarantee scheme, with your money secure at every stage Competitive: Grow your savings quicker with better rates than you’ll usually find on the high street* Straightforward: No fees, endless logins and paper application forms. Just a free, easy-to-use savings service Which savings account is right for me? Account holders get access to even more... 🟢 1 Year fixed rate bonds up to 1.30% AER Read more Compare zero-fee savings accounts Fixed Rate Bonds Interest rate won't change Easy Access Top up and withdraw anytime Notice Accounts Withdraw after a set notice period Term Show all (0) Amount Interest Term Bank Deposit guarantee Interest + bonus Raisin UK customers get access to even more: Register and log in now to view our full marketplace of savings accounts with competitive rates. Register now With many different types of savings accounts available, all with different terms, interest rates, and benefits, it can be difficult to know what type of savings account will help you maximise your money. On this page, you’ll find out more about the features and benefits of different types of savings accounts, how to compare savings accounts and how tax on savings works, giving you the information you need to decide which savings account is right for you. The rundown Savings accounts are a great way to strengthen your finances and act as a rainy day fund or pension pot Grow your savings more quickly by choosing an account with a competitive interest rate savings accounts offered by banks based in the UK include deposit protection of up to £85,000 per person, per banking group through the Financial Services Compensation Scheme (FSCS) Top types of savings accounts at a glance Fixed rate bonds You’re likely to earn the most interest with this type of savings account. However, you’re agreeing to ‘lock’ the money away until the end of a set term, so you won’t be able to withdraw any money until then. Easy access savings This is one of the most flexible types of savings accounts. You can withdraw money whenever you want, whilst still keeping the easy access account open. Notice accounts You’re likely to earn a competitive rate of interest with this type of savings account. You can keep the money in the savings account for as long as you like, but you’ll have to give ‘notice’ when you want to withdraw your money. Could a fixed rate bond be right for me? As you’ll be locking your money away for a set term, a fixed rate bond could be ideal if you have a long term savings goal and you know you definitely won’t need access to the money during this time. It could also be a good option if you’re looking for the most competitive rate of return on your money. Could an easy access savings account be right for me? An easy access savings account could be ideal if you’re looking for flexibility, and you want the freedom to make withdrawals and top up your savings as and when it suits you. It could be a good option if you have a short term savings goal, or you just want to put money away regularly whilst still earning a high street-beating rate of interest. Could a notice account be right for me? A notice account could be ideal if you’re looking to combine an element of flexibility with a competitive rate. It could be a good option for a medium term savings goal, or if you want the peace of mind that you can always access your money within a shorter period of time than a fixed rate bond. How to decide which is the right savings account for you The best savings account for you will depend on how much money you have to deposit, and whether you have a lump sum to put away, or you want to save a smaller amount regularly, instead. It also depends on how long you’re prepared to leave a lump sum untouched for and how often you want your interest to be paid. You can also choose to split your money by opening more than one type of savings account to get a mix of the benefits they provide. How to choose the right savings account for you Here’s some questions you can ask yourself to help you decide what type of savings account is right for you and your savings goals. What are you saving for? Deciding what your savings goals are can help you decide which savings account would suit you best. For example, if you’re saving for something specific, such as a new car or a trip abroad, an easy access account may be ideal as you’ll be able to withdraw your cash as and when you need to without a penalty, as well as being able to top up your balance whenever you want. For long term savings, a fixed term savings account may be a better option. Do you need access to the money immediately? Savings accounts have different rules as to when – and how often – you can withdraw your money. Easy access accounts usually allow you to withdraw your money whenever you like without incurring a penalty – but they do come with lower interest rates than fixed-rate savings accounts, and the interest rate can go up and down at any point. Fixed rate accounts require you to lock your money away for a fixed period, with no access to your money within this time – but in return you’re likely to receive a higher interest rate. How much would you like to save? How much you’re looking to save will affect what type of savings account suits you best. Regular savings accounts require you to deposit a set amount of money every month. If you don’t make the minimum payment into your account, your account may be closed or you may be given a lower interest rate. ISAs have a cap on the amount you can save each year (for the year 2020/2021, the ISA cap is £20,000). FSCS protected savings accounts will cover your money up to £85,000 per person, per banking group, so if you have more than this amount to deposit, it’s advisable to spread this money over more than one savings account to ensure you’re covered by the limit. What features are most important to you? Savings accounts come with different features which may suit what you’re looking for. If you’re looking to get into the saving habit, a regular savings account requires you to deposit a set amount on a monthly basis. They also come with stricter rules than other savings accounts, like limited withdrawals across a period of time. If you want to be sure of how much interest you’ll earn, a fixed rate savings account could be a good option over a variable savings account. Other features may also be important to you, such as having a Sharia-compliant savings account, or banking with a ‘Green’ bank or building society. Read on to understand why a savings account may be beneficial for you, and to help you choose the best savings account for your savings needs. What's on this page What is a savings account? November savings accounts update: what’s new? What are savings accounts for? How do savings accounts work? Who can open a savings account? What are the pros and cons of savings accounts? How to calculate interest on a savings account What are the most common types of savings accounts? Why compare savings accounts? What should you consider when you compare savings accounts? How many savings accounts can I have? Do I pay tax on money in a savings account? Is my money protected in a savings account? How to set up a savings account Savings Accounts FAQs What is a savings account? A savings account is an account you pay money into and earn interest from. It’s as simple as that, although there are different types of savings accounts to consider when choosing one that suits you (more on that below). Our co-founder Kevin Mountford has the following to say about savings, interest rates and how the financial climate affects your money. “Our finances play a significant role in our day-to-day lives, influencing our wellbeing and how we plan for our future. Whether you’re saving for a house, sending your children to university, building your retirement fund or you want to grow your financial safety net in case of the unexpected, growing your savings pot helps to make a lot of things possible.” We know that money matters, and through analysing search volume data, we’ve found the most frequently asked questions about savings accounts, and given Kevin the opportunity to share his expertise to answer them: November savings accounts update: what’s new? Tesco banks will be closing accounts come the end of November. This closure will lead to over 200,000 people needing to sign up with another provider for a new bank account. While Tesco says they will still be offering some savings accounts and credit cards, the current accounts are set to end. That means if you have a current account with Tesco, you’ll need to make sure your account balance is £0 by the time 30th November rolls around. While this might be frustrating news for Tesco’s customers, it could be the perfect opportunity to switch to an account with a bank offering better terms and services and elevated customer care. Raisin UK can help by connecting you with a range of banks that offer savings accounts with competitive rates. As you can manage all your accounts under one roof with Raisin, saving can be a fuss-free experience. Want to stay up to date with the latest offers and news on savings accounts each month? Sign up What are savings accounts for? A savings account is not only a safe place to stow your money; it also helps you grow your finances. Your money will grow based on the account’s interest rate and how much you deposit. As for what you save for, that can be absolutely anything. You might be thinking about saving for a house deposit, a new car, your retirement or even a once-in-a-lifetime holiday. Saving for a house Saving for a deposit on a new house is made easier when you opt for a savings account that suits you. You could even choose one that has restrictions on withdrawals to help you save, such as a notice account. Saving for holiday Whether you’re planning the trip of a lifetime or want to take the little ones somewhere special, having a savings account will help you stack up your spare cash. With lots of different types of savings accounts available, you’ll be able to find one that works for you. Saving for retirement With some advisers recommending that you save 10 times the amount of your annual salary ready for retirement, the earlier you put into your pension pot, the better. You could consider growing a lump sum for retirement with a fixed rate bond. Saving for children and grandchildren Making the decision to have children is a huge step, and definitely one that you want to be financially ready for. Whether it’s for your children or grandchildren, having a savings account set up for them will help them in later life. Saving for your wedding It’s called the big day for a reason, and with the average UK wedding costing around £30,000 in 2021, you’ll definitely want to take some financial stress out of wedding planning by having a pot ready. Tax-savvy savings ISAs, or individual savings accounts, are great for those looking to save in a tax-efficient way, as they allow you to save £20,000 per year (2020/21) without paying tax on the interest you earn. How do savings accounts work? A savings account works by you opening and paying into an account. In return for choosing to bank with your provider, they will pay you interest based on how much you have in your account. The bank will then use your money to give loans to other people, charging them interest. Essentially, a bank takes money from one person and rewards them with interest in the form of a savings account, and lends money to others and charges them interest in the form of a loan. Despite the bank using your money to provide loans, it is always available to you and is protected by the Financial Services Compensation Scheme (FSCS), as long as you deposit less than £85,000 per person, per banking group. Who can open a savings account? Each savings account will have its own terms and conditions regarding who can open an account and with what amount, but you will usually have to be aged 18 or over to open a savings account on your own. If you’re under 18, there are some accounts available to you, including Junior ISAs and children’s savings accounts. What are the pros and cons of savings accounts? Savings Account Advantages Savings Account Disadvantages Many savings accounts offer easy access and plenty of availability. They are easy to open and you can withdraw and deposit money anytime (within certain limits) by using online transfers and cashpoints. They often also have low deposit requirements. Low interest rates might mean that your money isn’t growing at the rate you would like it to. You can grow your money with savings accounts by choosing one that offers a competitive rate of interest. Inflation could mean that your money ends up having less buying power if interest rates remain low. A savings account can come with perks, such as insurance, recreational benefits and bonuses. Some savings accounts have a minimum balance requirement, such as £500 a month, meaning you will need to deposit this amount every 30 days. Most savings accounts don’t lock you in for any period of time, meaning you can change whenever you like. While easy access can be seen as a major plus, it also means that saving could be difficult if you often give in to temptation, and these types of accounts typically offer less competitive interest rates. Savings accounts provide a liquid asset that you won’t have to sell or go through lengthy procedures to have access to. Some savings accounts will have restrictions in terms of withdrawal limits and access. Be sure to check the terms and conditions before you commit. Up to £85,000 of your cash is protected in the unlikely event that your institution fails. How to calculate interest on a savings account The most simple way to calculate interest on a savings account is to multiply your account balance by the interest rate by the time period you plan to have the money in the account. The equation looks like this: D x R x T = interest earned D = Initial deposit R = Rate T = Time in the account How is interest paid on savings accounts? How interest is paid depends on your savings account, so it’s best to check the details to make sure you’re getting an account that’s right for you. It’s common to receive interest payments once a year, either on a predetermined date or on your account opening anniversary. Some accounts pay out interest monthly, and some may pay quarterly. In the case of fixed rate bonds, you may only receive an interest payment when your account matures, which could be up to five years. You’ll usually receive interest payments into a bank account you nominate, or the interest you earn can go straight back into your savings account. Are savings account interest rates worth it? Although saving account rates aren’t as high as they have been in recent memory, savings accounts still offer one of the most reliable and safest ways to grow your money. The Bank of England base rate is currently low, at just 0.1% (as of 19th March 2020). That means it can be difficult to find high-interest savings accounts that make your money work hard for you. Currently, some of the best savings interest rates in the UK are lump sum savings accounts that lock your money away to earn interest for a set period of time. You can view the top savings account rates in the table above. The most competitive lump sum account in our marketplace has an interest rate of 2.05% AER. When will interest rates go up or be cut? No one can say with certainty when interest rates will change, as this decision ultimately lies with the banks that offer them. The Bank of England (BOE) can influence change by changing the base rate, subsequently influencing financial institutions’ rates. The BOE made emergency cuts to the base rate in an attempt to reduce the impact of the coronavirus outbreak on the economy, cutting the base rate from 0.75% to 0.25% on 11th March 2020, and from 0.25% to 0.10% on 19th March 2020 (the lowest base rate on record). These emergency interest rate cuts may be a temporary response to the current financial crisis, but we cannot say for sure when interest rates will rise or fall. Interest rates fell in the same way just after the Brexit referendum and remained at previously historic lows for just 15 months before the BOE began raising the base rate again. As you can see from the chart below, the BOE base rate can rise and fall quite dramatically. The surge in the late 1970s and early 1980s was due to fighting high inflation caused by the rising costs of oil and wages. The base rate has been decreasing since the 2008 financial crisis in response to the recession, and more recently, the economic impact of the coronavirus pandemic, as shown below: What are the most common types of savings accounts? There are several different types of savings accounts, all offering different benefits. These are the most common types of savings accounts: Fixed rate bonds Fixed rate bonds require you to lock away your money for a set period of time. Interest rates are typically competitive, especially over the longer term. Easy access savings accounts The most straightforward savings account type, an easy access account is very flexible and allows you to deposit and withdraw money at any time. Notice accounts With a notice account, you can usually make deposits or withdrawals at any time, but you will need to give notice (usually around 60 days) to withdraw your savings. ISAs An ISA, or Individual Savings Account, is a tax-free savings or investment account. You can save up to a maximum of £20,000 per tax year (currently 6th April 2020 to 5th April 2021) before paying tax on your savings, and you can choose from a few different types of ISA, including cash ISAs and stocks and shares ISAs. Help to Save Help to Save is a government-backed type of savings account designed to help low-income earners save. Another common savings account type is a regular saver account, that requires you to save a set amount each month, which is ideal for those who are starting with a small amount rather than a lump sum. Some people also use their current accounts to save money, although this type of account rarely offers good rates of interest. According to a 2019 survey, these are the most common ways to save in the UK: What are fixed rate bonds? Fixed rate bonds or fixed rate savings accounts offer guaranteed returns on your savings over a set term, typically between six months and five years. Interest rates on fixed rate bonds are often better than standard or easy access savings accounts and are usually more competitive the longer your term is. If you have a lump sum of money that you want to grow and can afford to lock away, fixed rate savings accounts might be right for you. Learn more about fixed rate bonds What are easy access savings accounts? As the name suggests, easy access accounts have minimal restrictions and allow you to top-up or withdraw your money easily and at your convenience. Typically, easy access accounts, also known as instant access accounts, offer variable interest rates, meaning that the rate could both increase and decrease. Learn more about easy access savings accounts What are notice accounts? Notice accounts could be right for you if you want to grow a lump sum of money that you might need access to at a future date of your choosing. They allow you to make a withdrawal on a date you choose by giving your savings account provider notice, typically between 30 and 90 days, that you want to withdraw your money. Learn more about notice accounts Why compare savings accounts? It’s important to compare savings accounts so you find the account that suits your needs and pays a competitive rate of interest. In the wake of the coronavirus pandemic, there’s never been a more important time to get the best available rate. For example, many savings accounts are currently offering as little as 0.1%, but when you take a look around and compare savings accounts, you can usually find ones that offer much higher rates. What should you consider when you compare savings accounts? There are a few important things to consider when comparing savings accounts, which are as follows: Will this account allow me to access my money when I want or need to? Will the interest rate on this account help me reach my savings goal? Are there any restrictions that I need to be aware of? Is this bank covered by the FSCS? Are the interest payments made in a way that works for me? Should you compare savings account interest rates? It’s important to do a savings account comparison to make sure you get the right type of account and the right interest rate for you. You can compare savings account rates on fixed rate bonds and notice accounts in the table above. How to decide which is the best savings account for you The best savings account for you will depend on how much you have to deposit, whether you have a lump sum or want to save a smaller amount each month, how long you’re prepared to leave a lump sum untouched for and how you want your interest to be paid. You can also choose to split your money by opening more than one type of savings account to get a mix of the benefits they provide. How many savings accounts can I have? You can open an unlimited number of savings accounts, and it’s something worth considering. For example, you could open a fixed rate bond for long-term savings and have an emergency pot in an easy access account that you can dip into as and when you need to. You might also consider a notice account if you’re saving for a big holiday, a wedding or a house deposit. FSCS protected savings accounts will cover your money up to £85,000 per person, per banking group, so if you have more than this amount to deposit, it’s advisable to spread this money over more than one savings account to ensure you’re covered by the limit. Do I pay tax on money in a savings account? Less than 5% of UK savers will pay tax on the savings they earn. Basic rate taxpayers can earn up to £1,000 per year tax-free. For higher rate (40%) taxpayers, it’s £500. Find out more about taxes Is my money protected in a savings account? With regulated UK banks, your money is protected up to £85,000, or £170,000 for joint accounts, by the Financial Services Compensation Scheme (FSCS) should your savings provider collapse. This amount is per banking group, so if you have over £85,000, you could open savings accounts with different providers to ensure it’s all protected. All of the savings accounts in our UK marketplace include deposit protection, with accounts from UK banks providing FSCS protection. We only allow you to open savings accounts with up to £85,000, so you can be confident that your savings deposits are protected. How to set up a savings account While it might seem like a daunting process, setting up a savings account is really simple, quick and easy. It can be broken down into four steps: Step 1: Do your research & compare savings accounts to know what you want By knowing exactly what your savings goals and requirements are, you can make an informed decision when choosing the right account for you. Step 2: Know where you can open an account When you’ve chosen what kind of account you’d like to open, you’ll need to know exactly how to go about opening the account for yourself. The good news is that this is easily done either: In branch Over the phone By post Online Via a banking app Not all of these options are always available, it’s best to check with your chosen provider. Step 3: Have the information you need ready All providers require the same details when you open an account: Full name Date of birth Full address A contact telephone number Proof of ID (such as a passport or driving license) Proof of address (such as a utility bill) When it comes to the proof of address or ID, the bank will need to see the originals, not copies. Step 4: Get saving! You will then be given access to a savings account ready to deposit your first amount, subject to whatever terms you have agreed to. It’s as easy as that! Opening a savings account through the Raisin UK marketplace is just as easy, and our entirely online platform allows you to compare accounts from many different providers. For a more in-depth guide to opening an account with Raisin UK, explore our quick start guide. Why a savings account from our marketplace might be right for you: All of the savings accounts on our marketplace are free to open Your savings deposits are protected You’ll earn competitive interest rates You can choose from a range of savings accounts You can easily manage your savings online Quickly and easily open savings accounts with competitive interest rates from a range of UK banks by registering for a Raisin UK Account. It’s free to open a Raisin UK Account and savings accounts through our marketplace, and once you’ve been approved, you just need to make your deposit and watch your savings grow. Register today *Based on a comparison of Raisin UK partner bank rates and high street bank rates between 31 Dec 2019 – 31 Dec 2020 Savings Accounts FAQs Savings Accounts FAQs Home › Savings accounts Sign up for the latest offers and news Receive specially curated news and articles, and be the first to hear about exclusive rates and exciting offers when you sign up with us. Sign up More on Savings Accounts Easy Access Savings Accounts Notice Accounts Fixed Rate Bonds 6 month Fixed Rate Bonds 1 year Fixed Rate Bonds 2 year Fixed Rate Bonds 3 year Fixed Rate Bonds 5 year Fixed Rate Bonds Fixed Rate & Term Savings Account Term Deposit Lump Sum Savings Account No Access Savings Accounts Joint savings account Follow us Savings accounts All savings accounts Fixed rate bonds Notice accounts Easy access savings Sharia savings accounts Bonus Welcome bonus Refer a friend bonus Boost bonus About us About Raisin UK How Raisin UK works Deposit protection Partner banks Press releases Partner with Raisin UK Become an affiliate News Help and contact Contact us Customer care and complaints FAQs Guides Careers at Raisin UK Sign up for latest offers and news Online safety Privacy policy Cookie policy Security Terms & conditions Privacy settings © 2021 Raisin UK All interest rates displayed are Annual Equivalent Rates (AER), unless otherwise explicitly indicated. The AER illustrates what the interest rate would be if interest was paid and compounded once a year. This allows individuals to compare more easily what return they can expect from their savings over time. Raisin UK is a trading name of Raisin Platforms Limited which is authorised and regulated by the Financial Conduct Authority (FRN: 813894). Raisin Platforms Limited is registered in England and Wales, No 11075085. Registered office: Cobden House, 12-16 Mosley Street, Manchester M2 3AQ, United Kingdom. The information on this website does not constitute financial advice, always do your own research to ensure it's right for your specific circumstances. Tax treatment depends on the individual circumstances of each customer and may be subject to change in the future.