Best Charity Savings Rates Roundup November 2013

Charities frequently face obstacles when it comes to getting a good interest rate on their savings. Fair Investment Company is committed to helping charities get the best interest rates on their savings. Here we have put together a selection of the best charity saving accounts currently available.*

Latest easy access account deals

If you don’t want to tie up charity funds for too long in case they’re needed urgently, an easy access account might be worth considering.  For charities that are likely to require quick and easy access to their money at short notice, the Scottish Widows Charity Deposit Account offers instant access with no withdrawal penalties. The account requires a minimum deposit of £500, with an interest rate of up to 0.40% gross AER.

If you are prepared to opt a for a longer notice period, you may be able to gain potentially higher interest rate on your charity’s savings. The Cater Allen Asset 30 account offers a relatively short notice period of 30 days with a rate of 0.65% gross/AER. The minimum deposit for this account in £5,000, with monthly interest payments, and deposits are guaranteed by Santander.

Latest fixed rate bond deals

For those looking to save for a longer period of time, there are terms available ranging from one to three years. Scottish Widows offers charities a 3 Year Fixed Term Deposit with a rate of 1.50% gross AER fixed for three years. Deposits start from £10,000.

Cater Allen offers charities a choice of a 1, 2 or 3 year Fixed Term Deposit Plan which can be opened from £50,000. Rates are currently 1.30% AER/gross for the one year option, 1.90% AER/gross for two years and 1.95% AER/gross for three years, with all three plans requiring a minimum £50,000 deposit.

AER – Stands for the Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. (As every advertisement for a savings product which quotes an interest rate will contain an AER, you will be able to compare more easily what return you can expect from your savings over time)

Latest fixed rate bond alternatives for charities

If you’ve considered fixed rates in the past for your charity savings, you may be interested in the latest structured deposit plans, which provide an alternative to traditional fixed rate bonds. This type of savings plan offers the potential for market-linked returns, while protecting your capital at the same time.

The Investec 3 Year Deposit plan offers a target return of 13% after 3 years, provided that the Final Index Level (subject to averaging) is higher than the Initial Index Level. If, at maturity, the Final Index Level is equal to or lower than the Initial Index Level, you will not receive a return but your original capital will be repaid.

For those looking for a longer term plan, the Gilliat Deposit Kick Out Plan offers a potential return of 7.10% each year based on the performance of five shares, provided these 5 shares finish at least as high as their starting value. The plan is designed to be held for up to 6 years with potential for early maturity at years 2, 3, 4 and 5. The plan can be opened with deposits from £3,000. This plan is capital protected, but returns are not guaranteed and you may only receive a return of your original capital.

Structured deposit plans are capital protected. There is a risk that the company backing the plan or any company associated with the plan may be unable to repay your initial investment and any returns stated. In this event you may be entitled to compensation from the Financial Services Compensation Scheme (FSCS), depending on your individual circumstances. In addition, you may not get back the full amount of your initial investment if the plan is not held for the full term. The returns from structured deposits are not guaranteed. The past performance of the FTSE 100 Index and any companies listed on the FTSE 100 Index is not a guide to future performance.

No news, feature or comment should be seen as a personal recommendation to invest. If you are in any doubt as to the suitability of a particular investment you should seek independent financial advice.

* Data accurate as of 04/11/2013.


Written by James Caldwell ,
7th November 2013