Choosing the right kind of savings account can ensure that your investment grows safely and suits your needs.
However, with so many different varieties of options available at your end in the UK, deciding upon the best type can be a hard decision. So how do you go about it?
Knowing your savings account options
The first step is to understand which type of account you should opt for.
In the UK, there are 5 basic types of savings accounts. Knowing them and their unique set of advantages and disadvantages puts you in a better decision making platform.
- Easy Access Account: A bank account that offers unrestricted access to your money/savings. You are allowed to make withdrawals anytime.
- Notice Savings Account: If you have spare cash that won’t be needed for some time, a Notice Savings Account is where you put it.
- Regular Savings Account: For those who are trying to save some amount of money every month, this is the best.
- Cash ISA Accounts: The Cash ISA is an attractive scheme for anyone who pays a tax on savings. The profit is typically about 20%of the interest earned as compared to the standard savings account.
- Fixed Rate Bonds: Set for a specific time period, the rate of interest with Fixed Rate Bonds stays the same for the period of investment, even if the savings rate interests have changed.
You should give yourself time to do plenty of research to understand the best savings account you should be putting your money in.
The second step is to compare savings rates using one of the several comparison websites out there.
It is necessary that you choose a platform that works completely independent and aren’t owned or funded by any financial institution.
This ensures that you get a comprehensive, unbiased, and free service.