Easy access savings accounts

Flexible savings. Full control

• Enjoy the freedom to withdraw money and top up at your convenience
• Earn interest on your money whilst having the flexibility to access it when you need to
• Ideal for short-term savings goals or as a regular saver

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Easy access savings accounts are one of the most flexible types of savings accounts available to UK savers, giving you the freedom to top-up and withdraw money at your convenience.

All easy access accounts at Raisin UK are deposit protected and free to open online. The following are just some of the benefits offered by easy access accounts:

  • Top-up and withdraw at your convenience
  • Keep your account open for as long as you want
  • Competitive variable rates of interest
  • The FSCS or European DGS protects all savings accounts in our marketplace
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Easy access savings accounts allow you to grow your savings by topping up your savings pot and earning interest. Here, you’ll find everything you need to know about easy access savings accounts, including what to consider when opening this type of account, the benefits they offer to new and seasoned savers, and how they differ from other savings accounts.

What are easy access savings accounts?

Easy access accounts allow you to deposit your money and earn interest with minimal restrictions, so you can top-up or withdraw your money at your convenience. Typically, easy access accounts offer variable interest rates, which means that the interest rate may increase or decrease while your account is open.

You may also find there are some restrictions on easy access savings accounts, as well as notice periods, penalties and changes to interest rates – more on all that below.

November update: What’s new?

Some financial experts believe that the era of low low interest rates may be behind us. The Bank of England is thought to be one of the first that will raise rates to keep up with inflation. 

We have seen historic lows of 0.1%, but this is expected to rise and to bring the interest rates of borrowing back to a pre-pandemic level. This could affect all savers, with homeowners potentially seeing a rise in mortgage rates and household bills. This may be the perfect time to check in with your easy access savings account and make a plan in case you need to withdraw to prop up your finances for a while.

Want to stay up to date with the latest offers and news on savings and easy access accounts each month?

What restrictions are there on easy access savings accounts?

The types of restrictions on easy access savings accounts will differ from bank to bank, with typical restrictions including withdrawal restrictions, that stipulate how often you can withdraw funds, e.g. twice per calendar year, or that funds can only be transferred to a nominated savings account. For example, if you have an easy access savings account with one bank, you could choose your current account as the ‘nominated account’ to make any withdrawals and transfers easier.

Do I need to give notice to withdraw money from an easy access savings account?

Some easy access accounts may require you to provide a notice period before withdrawing any money. There may also be limits on how much or how often you can make a withdrawal, but this will depend on the account you choose.

Is there a penalty for withdrawing money from an easy access savings account?

In some types of easy access accounts, there may be a penalty for withdrawing more money than the terms of the account stipulate. This penalty might come in the form of forfeiting interest on your savings or even a charge. Be sure to check the small print before you open a savings account, so you’re sure it’s right for your needs.

Can interest be reduced on an easy access savings account?

Interest rates on easy access savings accounts are variable, meaning they are likely to fluctuate either up or down. 

Easy access accounts also typically offer lower rates of interest compared with ‘stricter’ savings accounts, as they offer so much flexibility for you to access your cash. If you’re looking to open an account with a higher, fixed rate of interest, you might want to consider fixed rate bonds instead of easy access savers. 

Are easy access savings accounts and instant access savings accounts the same thing?

While they’re similar, in that they both allow you to top-up and withdraw money, easy access and instant access accounts differ on one key detail. Instant access account transactions will usually be completed within a couple of hours. Easy access account transfers can take up to two working days (weekdays, excluding bank holidays) to complete.

How do banks calculate interest on easy access accounts?

Some easy access savings accounts pay interest once a year, usually on a set date or on the anniversary of the opening of your account, however others pay monthly or quarterly. Some easy access accounts might give you the option to have the interest added to your savings or paid directly into a nominated account. 

When you’re comparing easy access accounts, it’s important to check how often interest is compounded and to note that there’s a difference between the AER and the gross interest rate. The AER, or annual equivalent rate, considers more factors than the gross rate does and is based on the assumption that you’re going to keep your money in the account for a year.

Is an easy access savings account right for me?

Deciding whether or not an easy access savings account is right for you is down to your personal preferences and financial goals. 

Keeping your money safe and earning interest is never a bad decision, but your choice of savings account is likely to boil down to the restrictions and ease of use, as well as whether you’re able to lock your money away for a certain period or not. 

As you can see from the chart below, instant access savings accounts are the most popular type of savings account in the UK:

The best way to decide whether an easy access account is right for you or not is to compare different savings accounts.

What are the benefits of easy access savings accounts?

The main benefit of easy access savings accounts is that they offer flexibility. This type of account might be right for you if you want to access your savings at your convenience, say in case of an emergency, or if you’re not saving for anything specific.

Easy access accounts may also be a good idea for first-time savers and those who want to get into the habit of saving without making a big commitment, because you don’t need a lump sum to kickstart your savings. For example, some easy access accounts require as little as £1 to open. Although you typically don’t need to invest a lot to open an easy access account, it’s important to try and save as much as you can, as you’ll earn more interest that way.

It’s usually beneficial to compare easy access savings accounts to find one that suits you and your savings goals.

What are the downsides to easy access savings accounts?

The biggest disadvantage of easy access savings accounts is that they typically offer lower interest rates than other savings accounts types, such as fixed rate bonds or notice accounts, due in part to the added flexibility they provide.  

Other than that, there are sometimes stipulations in the fine print as to how many withdrawals you can make or how often. It’s important to check these details before you open an account.

What should I consider when opening an easy access account?

If you need flexibility, simplicity and easy management from your savings account, easy access accounts might be the best flexible savings account for you. Just make sure you check the small print of each account you’re considering opening, as there might be limitations on how often you can withdraw your cash, minimum deposit amounts or penalties for breaking restrictions.

You might also want to consider whether an easy access account suits your savings goals or if a different type of savings account could be better for you. 

Notice accounts, for example, could offer more competitive variable rates of interest but require a lump sum deposit to open and you need to give up to 90 days’ notice when you wish to make a withdrawal. After you make a withdrawal from a notice account, your account closes, meaning that notice accounts are better suited to people who want to save for a specific purchase.

If you have a lump sum to deposit and can lock your money away for up to five years, fixed rate bonds typically offer competitive fixed interest rates, so you’ll know how much interest you’ll earn and your money will be available after a fixed term.

It’s quick, easy and free to open any of these types of savings accounts at raisin.co.uk.

How much money do I need to open an easy access savings account?

You don’t usually need a large deposit to open an easy access savings account. While some of the top-rate, higher-interest easy access accounts may require deposits of up to £1,000, there are many available that offer initial deposits from just £1.

Do I have to pay tax on interest from my easy access savings?

The amount of tax you pay on interest from your savings depends on how much you earn, but don’t worry, fewer than 5% of all UK savers pay tax on their savings.

Low-income earners can earn up to £5,000 in interest before paying tax. This is known as the 0% tax ‘starting rate’. This rate decreases for every £1 you earn over your personal income tax allowance of £12,570 (2021/22 tax year). 

Basic rate taxpayers can earn up to £1,000 per year tax-free, while higher rate (40%) taxpayers can earn up to £500 per year tax-free. 

Is my money protected in an easy access savings account?

All easy access savings accounts offered by regulated UK banks are protected by the Financial Services Compensation Scheme (FSCS). The FSCS deposit protection scheme covers deposits of up to £85,000 per person, per banking group.

How do I know which is the best easy access savings account for me?

The best way to find the right easy access savings account for you is to do the following:

  • Know what account features are your priority (e.g. the interest rate, any perks or rewards the account comes with or how often you can make withdrawals) 
  • Do your research 
  • Don’t forget to read the small print

 

How much should I have in easy access savings?

How much you have in your easy access savings account is entirely your choice, but most financial experts recommend having enough money set aside to cover your expenses for three to six months in case of any unexpected financial shocks or changes in circumstance.

With this in mind, you might want to create a budget plan to see what your monthly expenses look like. 

What should you consider when you compare easy access savings accounts?

Having an idea of what you want to get out of your savings account will make it easier for you to compare easy access savings accounts to find the best savings account for you. 

For example, you might want to compare interest rates so you know you’re getting the best rate over the longest term. If you’re looking for an easy access savings account that offers the most flexibility in terms of how much or how often you can make withdrawals, those are important details to look for. 

How does Raisin UK work?

If you want to quickly and easily open savings accounts with deposit protection, register for a Raisin UK Account and log in to apply. Opening a Raisin UK account and applying for savings accounts from our partner banks is free, and once you’ve been approved, all you need to do is make a deposit and watch your savings grow.

 

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