Compare Instant Access Savings Accounts

Oliver Roylance-Smith, Director "Here you can access our range of leading instant access savings accounts. You can compare features of the latest instant access savings deals in the table below and apply online. We've also provided our selection of some of the top short term fixed rate bonds, in case you're looking for higher rates. Or, you could protect your savings from tax, whilst still having access to it whenever you want, with our selection of instant access cash ISAs. "
Oliver Roylance-Smith, Head of Savings and Investments
Savings Maximiser
ProviderAccountFeaturesIndicative Rate* (AER)Latest RatesApply
Instant AccessUp to
1.39%
FactsheetApply Now >
  • Savings service - *Indicative rate of interest highlighted
  • Competitive interest rates from leading UK banks and building societies
  • All money held in your name
  • Online Access
  • £25k minimum deposit
  • Service fee of £20 per month

* The indicative rate is not a guaranteed rate and reflects what we might achieve when we deposit your money in the Savings Maximiser service based on prevailing interest rates as at 12/12//2014. The indicative rate is based on an average rate across two UK bank accounts. The rate you achieve will be determined by the amount you deposit.

Instant Access Savings Accounts Deals
ProviderAccountInterest Rate (AER)TermApply
1.25%Instant accessMore Info >
  • Minimum deposit £500
  • Interest paid on balances above £500 and below £1,000,000
  • Manage your account in branch or online  
  • Covered by the FSCS (Financial Services Compensation Scheme)
  • Must be aged 18 or over and a UK resident

0.75%Easy AccessMore Info >
  • Monthly and Annual Interest Options 
  • Access – online, telephone and post
  • Covered by the FSCS (Financial Services Compensation Scheme)
  • Minimum deposit £1,000
  • Variable interest rate

 

0.50%Instant accessMore Info >
  • Balances from £1 to £24,999 receive a rate of 0.50% AER/0.50% Gross p.a. (variable) rising to 0.75% AER/0.75% Gross p.a. (variable) for balances of £25,000 and over.
  • No penalties and no withdrawal charges 
  • Manage your account online, in branch or by phone 
  • Over 16s only

0.50%Instant accessMore Info >
  • Balances from £1 to £24,999 receive a rate of 0.50% AER/0.50% Gross p.a. (variable) rising to 0.75% AER/0.75% Gross p.a. (variable) for balances of £25,000 and over.
  • No penalties and no withdrawal charges 
  • Manage your account online, in branch or by phone 
  • Over 16s only

Interest Paying Current Accounts

Surprisingly some of the best interest rates you can get currently on your savings come from current accounts. Below are a selection of current accounts paying high interest. With Nationwide you can earn up to 5% on savings up to £2,500 and 3% with Santander for savings between £3,000 and £20,000. These accounts come with conditions but provide an opportunity for you in most cases to at least double the interest you would receive currently from a traditional instant access savings account.

Latest Current Account Deals
 AccountInterest (AER)Overdraft RateFunding Required*Fee pmFeaturesApply
5%**0% for 12 months, 50p per day after£1,000 per monthN/A5% in-credit interest on balances up to £2,500 for the first yearMore Info >
Nationwide FlexDirect Current Account

  • **5.00% AER (4.89% gross pa) in-credit interest on balances up to £2,500 for the first 12 months
  • No monthly fee
  • Paperless statements 
  • Visa Debit card and option chequebook 
  • Manage your account online
  • No fees on arranged overdrafts for the first 12 months 
  • Must be 18 or older
  • Overdraft charge of 50p per day after the first 12 months
  • Must pay a minimum of £1,000 into the account each month, from an external source (i.e. not another Nationwide account)

 

Up to 3%£1 per day£500 pm£2Earn cashback on household bills. 3% AER on balances over £3000 More Info >

Santander 123 Current Account

  • Earn cashback on your household bills - 1% on water, council tax bills and Santander mortgage payments, 2% on gas and electricity bills, and 3% on mobile phone, home phone, broadband and paid-for TV packages
  • Visa Debit Card
  • Withdraw up to £300 a day from any Santander or Link cash machine
  • Must be 18 or older and a UK resident
  • Cashback available when you set up at least two eligible Direct Debits 
  • Monthly fee of £2
  • Must pay a minimum of £500 into the account each month

*Some current accounts require customers to pay in a minimum amount each month.

Peer to Peer Savings Accounts

If you are looking for other options for your money and you are fed up with low interest returns then you may wish to consider Peer to Peer Savings Accounts. These type of accounts are becoming increasingly popular in the UK where your money is lent out either to individuals or companies and in return you receive interest which is either paid to you monthly or at the end of a fixed term.

Peer to peer savings accounts are not the same as normal savings accounts so you need to consider the features before you invest.

Peer to Peer Lending - Earn high interest on your savings
ProviderAccountTermTarget ReturnMore Info
3 years (flexible)7.00%
per annum
Apply Now >
  • Earn 7.00% P.A. gross return per annum, capped and protected by a Provision Fund
  • Manage your account online
  • The Green Energy Income Account has been designed to make an actively diversified portfolio of loans in renewable energy projects available to peer to peer lenders.
  • Loans within this account should typically repay within three years based on their contracted repayment dates (their due date for repayment). However you may flexibly sell part or all of your investment at any time prior to that via the Aftermarket, subject to continued demand for these loans.
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS
5 years6.00%
per annum
Apply Now >
  • Earn 6.00% per annum
  • 60 month term
  • Loans are secured on property
  • Manage your account online
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS
4-5 years5.50%
per annum
Apply Now >
  • Earn up to 5.50% per annum
  • 4 to 5 year term
  • Threefold protection which includes the Lending Works Shield. The Shield has insurance against borrower defaults, cybercrime and fraud. No other peer-to-peer lender offers this.
  • Lenders are protected up to a default rate of 10%, over five times greater than other reserve funds
  • 100% capital returned to every lender
  • Manage your account online
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS
3 years4.40%
per annum
Apply Now >
  • Earn 4.40% per annum
  • 36 month term
  • Manage your account online
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS
3 years4.25%
per annum
Apply Now >
  • Earn 4.25% per annum
  • 36 month term
  • Loans are secured on property
  • Manage your account online
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS
1-3 years4.00%
per annum
Apply Now >
  • Earn up to 4.00% per annum
  • 1 to 3 year term
  • Threefold protection which includes the Lending Works Shield. The Shield has insurance against borrower defaults, cybercrime and fraud. No other peer-to-peer lender offers this.
  • Lenders are protected up to a default rate of 10%, over five times greater than other reserve funds
  • 100% capital returned to every lender
  • Manage your account online
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS
Easy Access3.50%
per annum (Tracks the Bank of Englands Base Rate (BBR) +3%)
Apply Now >
  • Earn 3.50% per annum
  • Tracks the Bank of England Base Rate + 3%
  • 36 month term
  • Manage your account online
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS
1 year3.00%
per annum
Apply Now >
  • Earn 3.00% per annum
  • 12 month term
  • Loans are secured on property
  • Manage your account online
  • Must be aged 18 or older
  • Peer to peer lending is not covered by the FSCS

AER - Annual Equivalent Rate

 

* This is the weighted average net return across all investors lending for 180 days or more through Funding Circle over an annualised period (simple average = 5.8%; median = 6.5%, ie, 50% of investors are earning 6.5% or more). It includes all earnings and is calculated after fees and bad debt but before tax. Past performance is not a guide to future performance. This investment involves lending to UK businesses, where the value of your investment is variable and can go down as well as up. Data correct as of 19 February 2014.

 

Peer-to-peer lending can offer potentially attractive returns. There is a risk you may lose some or all of your initial investment as it is not protected by the Financial Services Compensation Scheme, although many lenders offer their own compensation schemes.

About Instant Access Savings Accounts


While there are many savings accounts on the market many do not offer much of a financial advantage as they offer interest that only matches the base rate set by the Bank of England – currently around 0.5%. If you are prepared to shop around you can find savings accounts that pay competitive levels of interest but still allow instant or "easy" access. Instant access  savings accounts as the term suggests allows you to access your money without penalty although some accounts may stipulate a maximum number of withdrawals per year.


For savers looking to access their money regularly, a good instant access savings account will offer flexible withdrawal facilities while combining these with a good rate of interest. Although fixed rate bonds or notice accounts offer better long-term rates of interest, they generally do not allow savers to take their money out until the bond has matured or provide restrictions on withdrawals and may apply penalties. The ability to access funds at short notice can be very helpful. This flexibility comes at the cost of greater interest.

 

Why Choose an Instant Access Savings Account in 2014


Everybody should be saving, and with the unpredictable economic climate, people should keep a nest-egg handy to cover unexpected expenses. Saving is a good discipline to develop - most independent financial advisors recommend keeping the equivalent of three to six months’ salary saved up to provide a financial buffer in case of unforeseen circumstances e.g. redundancy. Instant access savings accounts provide a good home for short term goals, such as a holidays or school fees although you may also want to consider notice accounts and fixed rate bonds for timescales greater than 3 months.


With the Bank of England Base rate at an all-time low, making sure you are maximising the interest on your savings is as important as it has ever been particularly taking into account the erosionary impact of inflation over time. If you are prepared to shop around it is still possible to earn higher rates of interest on your savings by comparing and choosing a range of savings plans, that suits your needs. 

 

How to Choose an Instant Access Savings Account for 2014


The first thing to establish when choosing an instant access savings account is whether the interest rate is fixed or variable. Bonus rates can be very favourable for savers to place their money onto an instant access account – often offering rates of interest  for the first few months, and giving the providers an attractive rating on comparison websites -  but providers often lower the rate shortly after, reducing the competitiveness of the interest gained during this time and rely on savers not to notice the drop.


Within variable-rate savings accounts, the rate of interest on any account can go down as well as up. For the saver, this means it is important to constantly monitor the performance of the savings account and be prepared to move to a better-performing account. An account paying 3% AER may have a bonus which could represent more than half of this rate e.g. 2% payable after 12 months. After this time the rate would drop to 1% AER - not so competitive! While this account provides a good rate initially, you need to consider shopping around for a better deal after 12 months so relies on you being proactive to ensure you are maximising interest return.

 

What you should be aware of when using an Instant Access Savings Account for 2014?


  • Initial rates that include a bonus may seem less favourable after the first year – be prepared to move your money at the end of this period as future rates will drop.

 

  • Offers from Internet-only banks are sometimes preferred as these providers do not have to maintain a high street presence, minimising overheads. However, if you are not technically confident, maintaining an account over the computer can often be troublesome and you may prefer dealing with a human being in a branch who can answer your questions directly.

 

  • Some accounts can be opened and maintained with a minimal deposit – often as low as £1 – but many providers will offer incentives such as tiered interest rates to encourage savers to commit more of their money to the account. Make a point of regularly looking at the top 10 instant savings account providers to see who has taken pole position in the league tables – especially if their rates are better than the returns that your money is currently receiving. Use a comparison website to check other providers’ rates, as many savers will be doing the same.

 

  • Interest paid on your savings is treated as income and you may have to pay tax on it depending on your circumstances. If you don’t pay tax you can receive interest gross if you complete tax form R85. Some accounts will pay interest gross and it is up to you to declare any tax owed to the Inland Revenue.

 

With interest rates at the time of writing at an all-time low the impact in real terms of inflation on your money is not to be underestimated in eroding the buying power of your hard earned cash. Use our savings account comparison tables to ensure you get a good savings rate.

 

Top Ten Tips for using Instant Access Savings Accounts in 2014


1. Even though you might be attracted by the idea of “Instant Access”, don’t consider the account as a convenient source of regular withdrawals- that is what your current account is for.


2. Keep focusing on a significant purchase that might require rapid access- a new car or a wedding- and let the account work for you.


3. Be vigilant to changes in the rate offered by the provider.


4. Unlike high street savings branches, internet-only savings accounts will not allow you to access your money directly- this will need to be transferred into your current account, and this might not be instant - could take a few days.


5. Check when interest is due to be paid – is it monthly or annually? Is there an incentive to leave your money in the account for at least one year?


6. Check to see if your provider also requires you to open a current account, before opening a savings account.


7. For savers who are not comfortable with internet transactions, it might be preferable to look for a provider that provides branch access options.


8. Check for withdrawal penalties- by taking your cash out early you might risk the interest on your savings.


9. If you have money remaining in your current account at the end of each month it is worth moving it over to your savings account- no matter how little- as this will all contribute to workable funds and help earn interest.


10. Work out how much you are likely to have saved by the end of the year- and the interest that is likely to be paid.