Charity Savings Accounts

Charity Savings Accounts

Capital Protected Deposit Investments

Plan Name

Investec FTSE 100 6 Year Deposit Plan

Maximum Potential Return
45%
at end of term
Term
6 years
ISA Option

Important Information: This is a structured deposit plan and is 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.

Plan Name

Investec FTSE 100 Kick Out Deposit Plan

Maximum Potential Return
6.00%
per annum
Term
Up to 6 years
ISA Option

Important Information: This is a structured deposit plan and is 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.

Plan Name

Investec FTSE 100 6 Year Defensive Deposit Plan

Maximum Potential Return
25%
at end of term
Term
6 years
ISA Option

Important Information: This is a structured deposit plan and is 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.

Plan Name

Investec FTSE 100 3 Year Deposit Plan

Maximum Potential Return
15%
at end of term
Term
3 years
ISA Option

Important Information: This is a structured deposit plan and is 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.

Plan Name

Investec FTSE 100 Defensive Kick Out Deposit Plan

Maximum Potential Return
4.50%
per annum
Term
Up to 6 years
ISA Option

Important Information: This is a structured deposit plan and is 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.

Plan Name

Investec FTSE 100 3 Year Defensive Deposit Plan

Maximum Potential Return
10.50%
at end of term
Term
3 years
ISA Option

Important Information: This is a structured deposit plan and is 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.

Plan Name

Investec FTSE Income Deposit Plan

Potential Annual Income
3.50%
per annum
Term
6 years
ISA Option

Important Information: This is a structured deposit plan and is 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.

Non-Personal Savings Accounts

Account
Nationwide 95 Day Notice Business Savings
Interest Rate
1.10%
Gross/AER
Term
95 Day Notice
Minimum Deposit
£5,000
Account
Aldermore Easy Access Business Savings
Interest Rate
1.00%
Gross/AER
Term
Easy Access
Minimum Deposit
£1,000
Account
Nationwide Instant Saver Business Savings
Interest Rate
0.65%
Gross/AER
Term
Instant Access
Minimum Deposit
£5,000
Account
Aldermore Bank 1 Year Business Fixed Rate Bond
Interest Rate
1.50%
Gross/AER
Term
1 Year
Minimum Deposit
£1,000
Account
Aldermore Bank 6 Month Business Fixed Rate Bond
Interest Rate
1.15%
Gross/AER
Term
6 Months
Minimum Deposit
£1,000
Account
Nationwide 1 Year Business Fixed Rate Bond
Interest Rate
0.75%
Gross/AER
Term
1 Year
Minimum Deposit
£5,000

What are Charity Savings accounts?

A charity savings account is often a better way for charitable organisations to earn interest on funds compared to current accounts which usually pay minimal or no interest. Charity savings accounts are provided by most UK high street banks and building societies.

Charity savings accounts or charity deposit accounts as they are often called can range from instant access to accounts which have a notice or fixed savings period. Different charity accounts will offer terms on choice of access, minimum and maximum deposit balances and method of operation e.g. telephone, post, internet or through the branch.

Benefits of Charity Savings Accounts

Charitable organisation trustees are obligated to do their best in getting good rates of interest on funds held. With many charity deposit accounts offering poor rates of interest trustees need to take a proactive approach in ensuring their savings provider is offering a good deal. Our research shows that many banks and building societies offer lower rates of interest on charity savings accounts compared to those offered in the individual retail space. Investing time in shopping around and comparing latest savings deals is time well spent. The difference between the lowest and highest charity savings accounts can be significant.

In looking at 51 UK bank and building societies offering instant access club and charity accounts based on a deposit of £100,000, interest rates ranged from 0.05% AER to 2.00% (Source: Moneyfacts June 2012). This is a difference of £1,950 in annual interest. What is also clear is that many of the well known high street banks who hold the bulk of charity savings money are offering interest rates at the lower end of the scale. If your charity is prepared to deposit money on a notice basis or fixed rate account basis then interest rates can be significantly more attractive generating higher returns. With a charity savings account the charity can benefit from interest being added either monthly, quarterly or annually depending on the Provider terms. Interest can often be paid to a nominated bank account. Typically the longer the charity can lock away money the better the interest rate that can be achieved.

Different Types of Charity Savings Accounts

Charity Instant Access Savings Accounts

No notice is required and funds can be obtained through the specified method of operation e.g. online transfer into the charity current account. With these accounts interest paid will be higher than charity current accounts but lower than charity notice accounts.

Charity Notice savings Accounts

The notice period on these accounts will typically range from 7 days to 180 days. Generally the higher the notice period needed to be given to the savings provider the higher the rate of interest offered.

Charity Fixed Rate Bond Savings Accounts

These are savings accounts for a fixed period of time where the interest offered is paid if you the charity is prepared to tie up money on deposit for a fixed term ranging anything from 6 months to 5 years. There are usually interest penalties if money is withdrawn early.

Other types of Charity Savings alternatives to Consider

Structured Deposit Plans

For trustees who are comfortable tying up capital from 3 to 6 years and are looking for returns that offer the potential of beating cash where the returns are based on stockmarket performance then structured deposit plans are worth a closer look. These plans are designed to be held for the full term and returns are usually not guaranteed.

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 a charities cash on deposit. Our research shows that many charity savings accounts offer poor value and there can be significant differences on what interest is paid from one account provider to the next. Use our charity savings comparison tables to ensure you get a good savings rate.