Yorkshire Building Society has announced the launch of a new regular savings account to help people build “financial resilience” and earn a “competitive return” on their short-term savings.
The account boasts a variable interest rate of 4.5 percent and allows customers to deposit between £1 and £250 per month.
Chris Irwin, director of savings at Yorkshire Building Society, said “Our founding purpose as a building society is to help people build financial resilience so we’re committed to exploring ways that can help our members reach their financial goals or save for the future.
“Regular savings accounts are one way we can encourage people to establish healthy savings habits.
“They are a great help if they have a goal in mind, a special occasion like a wedding to save up for, or future investments like a car purchase or house deposit. We are really proud that this account will support customers, whatever their circumstances, and encourage those who are able to save money regularly.”
The account can be opened in branches, agencies and online, and allows savers to access their savings twice a year without penalty, and people can close the account if required. After 12 months the account will mature into an off-sale Easy Access Saver maturity account.
Interest rates on savings accounts are growing increasingly competitive month-on-month, and many analysts are urging Britons to review their accounts to make sure they’re opting for the best deals.
Commenting on the market, Lucinda O’Brien, personal finance expert at Money.co.uk Savings, said: “In April 2022, the Bank of England’s Base Rate was 0.75 percent, with an average interest rate for savings accounts at 2.72 percent and average instant access rates at 1.35 percent.”
Fast forward to the start of May this year, Ms O’Brien continued: “The Bank of England upped the base rate to 4.5 percent and the average interest rate for a savings account was 3.31 percent, with the average for an instant access at 2.42 percent.
“This clearly shows that rates have increased – although maybe not as high as we would like to see – so there is no reason to leave your hard-earned money in a low-interest savings account.”
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While Yorkshire Building Society’s new regular savings account offers an attractive deal, it isn’t the leading rate on the market. A number of high street banks’ regular savers exceed YBS’ 4.5 percent rate.
Topping the list is first direct’s Regular Saver offering an Annual Equivalent Rate (AER) of seven percent on up to £3,600 per year.
Interest is calculated daily and paid on maturity of the account exactly one year after opening. Savers can deposit between £25 and £300 per month in multiples of £5.
Withdrawals are not permitted throughout the duration of the 12-month term. In the event of this, the account will have to close and interest will be paid up to the closure date at the Savings Account variable rate instead.
Lloyds Bank, NatWest, and the Royal Bank of Scotland are also offering competitive interest rates of 6.25 percent, and 6.17 percent, respectively.
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Lloyds Bank’s Club Lloyds Monthly Saver at 6.5 percent is available to Club Lloyds customers and a £25 deposit is required to open it.
The term runs for 12 months and the interest rate is fixed and paid on the anniversary of the account opening, and deposits between £25 and £400 must be invested before the 25th of every month. Unlimited withdrawals are permitted without penalty.
NatWest and the Royal Bank of Scotland offer a 6.17 AER on their Digital Regular Savers on deposits up to £5,000, after which a one percent rate is applied to savings from £5,001 and over.
There is no minimum deposit required to open the account and people can save up to £150 each month. Unlimited withdrawals are permitted without penalty and interest is awarded monthly.
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