Martin Lewis discusses bank account switching deals
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The Bank of England increased its Base Rate for the seventh time this year, pushing borrowing costs to the highest in 33 years. However, one group to largely benefit from these hikes are savers, as banks and building societies generally reflect the Base Rate by also boosting interest across their accounts. While there are no accounts that currently beat the UK’s soaring inflation rate, savers are able to garner much higher returns than in previous years.
Alice Haine, personal finance analyst at Bestinvest said: “A 0.75 percent rise in the Base Rate is great news for savers, with many already taking advantage of better deals in the market.
“Households deposited an additional £8.1billion with banks and building societies in September – the most since June 2021 – cashing in on higher rates that now top 2.5 percent for an easy access account and five percent for a fixed rate account and bolstering their reserves in the face of difficult times ahead.
“Savers that don’t switch their money to a high-interest account are seriously missing out, particularly when you consider the real return on their money is still deeply negative as inflation at 10.1 percent erodes the purchasing power of that cash.”
While there are a wide variety of savings accounts people can opt into to suit different needs, easy access savings accounts tend to be one of the simplest of all.
These accounts enable account holders to make payments and withdrawals with minimal restrictions, and tend to have low opening deposit requirements.
However, some offer higher interest rates than others. Money comparison site MoneyFacts has pulled together the top 10 available right now.
Top 10 easy access savings accounts
Ranking top of the list is Al Rayan Bank’s Everyday Saver (Issue 3) with an Annual Equivalent Rate (AER) of 2.81 percent.
A minimum of £5,000 must be deposited to open this account and people can make unlimited withdrawals free of charge.
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Interest is calculated and credited to the account on the last day of every month.
Coming in second is Tandem Bank’s Instant Access Saver with an AER of 2.55 percent.
There is no minimum deposit required to open this account, interest is paid monthly, and up to £250,000 can be invested.
Ranking third on the list is Marcus by Goldman Sachs’ Online Savings Account with an AER of 2.5 percent.
There is also no minimum deposit required to open this account and interest is calculated daily and paid monthly.
While the AER is variable, the account includes a bonus gross rate of 0.25 percent fixed for the first 12 months.
Ranking fourth is SAGA’s Saga Easy Access Savings Account, also with an AER of 2.5 percent.
No minimum deposit is required to open the account and a maxim of £100,000 can be invested overall.
This account also offers a fixed 0.25 percent bonus gross rate for the first 12 months, and interest is calculated daily and paid monthly.
Investec Bank plc’s Online Flexi Saver lists fifth with an AER of 2.45 percent.
This account requires a minimum deposit of £5,000 to open and up to £250,000 can be invested.
Savers can choose interest to be paid monthly into a linked current account, or added to the savings in the Online Flexi Saver.
Listing sixth on the list is Harpenden BS’ Triple Access Saver with an AER of 2.4 percent.
A minimum deposit of £100 is required to open the account and interest is calculated daily and applied annually on December 31.
However, if more than four withdrawals are made in one calendar year, interest will drop to 1.4 percent.
Coming seventh is Zopa’s Smart Saver, also with an AER of 2.4 percent.
Zopa also allows customers to open personalised pots however, a maximum of £85,000 can be deposited to the account in total before account holders are no longer allowed to submit any more cash.
There is no minimum deposit and interest is paid monthly.
Paragon Bank’s Triple Access Account (Issue 10) lists eighth with an AER of 2.3 percent.
A minimum of £1 is required to open the account and a maximum of £500,000 can be invested. However, only three withdrawals are permitted within 12 months without the account seeing a drop in interest to 0.75 percent.
Account holders can also choose whether they’d like interest to be paid monthly or annually.
Shawbrook Bank’s Easy Access – Issue 31 ranks ninth on the list with an AER of 2.3 percent.
A minimum deposit of £1,000 is required and interest is calculated daily and applied on the anniversary of the date the first deposit is made.
Unlimited withdrawals are permitted, however, the minimum amount is £500.
Tenth on the list is the Yorkshire Building Society’s Internet Saver Plus Issue 12 with a new AER of 2.25 percent.
This account offers a variable interest rate in tiers, applying two percent AER to figures between £1 and £9,999. A 2.25 percent AER is applied to the balance at £10,000, while a 2.3 percent AER is applied to the balance at £50,000.
Interest is calculated daily and applied annually on March 31.
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