In 2023 we have seen the biggest hikes in savings rates in a long time. If you have cash savings sitting around, it is now worth your time to move it into a high-interest savings account if you haven’t already.
Below we will take a look at the best options for each different type of savings account including Easy Access, Limited Access, Current Accounts & More.
Best Savings Accounts October 2023
Below you will find the highest-paying savings accounts in each different category. You can find a description of each account type below.
| Type | Rate | Provider | Min/Max Deposit | FSCS Insured? |
|---|---|---|---|---|
| Easy Access | 5.2% | Ulster Bank | £5,000/No Max | Yes |
| Limited Access | 5.2% | Chorley Building Society | £1,000/£250,000 | Yes |
| Regular Saver | 8% | Nationwide | £200 Max Monthly | Yes |
| Current Account | 7% Before Fee | Santander Edge | £0/£4,000 Max | Yes |
| Fixed Rate 1 Year | 6.2% | NS&I | £1,000/£1M | Yes |
| Fixed Rate 2 Year | 6.05% | Ford Money | £1,000/£2M | Yes |
| Fixed Rate 5 Year | 5.8% | JN Bank | £1,000/£100,000 | Yes |
| 120 Day Notice Account | 5.45% | Dudley Building Society | £1,000 Min | Yes |
| Cash ISA Easy Access | 4.81% | Shawbrook Bank | £1,000/£20,000 | Yes |
Current Inflation Rate vs Savings Interest Rates
One of the reasons we put our money in a savings account is to preserve the spending power of our money. With inflation at some of the highest levels in the past 10 years it’s even more important to earn interest on your money where you can.
Your goal should be to get a higher rate of interest than the current inflation rate or as close as possible. Currently, inflation is above 7% in the UK meaning it’s very hard to get an interest rate higher than that.
The account we have chosen above and below offer some of the best rates in the industry right now allowing you to earn as much interest as possible to combat inflation.
Best Easy Access Accounts
Below you will find the best easy-access accounts available in the market right now. These are the accounts that are currently offering the highest rates in the market for an Easy-access account.
| Rate | Provider | Minimum Opening Balance | Apply |
|---|---|---|---|
| 5.2% | Ulsterbank | £5,000 | Apply |
| 5.11% | Shawbrook Bank | £1000 | Apply |
| 5.1% | Beehive Money | £1000 | Apply |
| 5.06% | Ratesetter Via Hargreaves Lansdown | £1 | Apply |
| 5.04% | Family Building Society | £100 | Apply |
Other easy-access accounts that deserve a mention here are:
- Cynergy Bank – 4.55% AER Variable |Min £1 / Max £1m | Online
- Chip powered by Clearbank – 4.51% AER Variable | Min £1 / Max £250,000 | App/Online <– The account I personally use
Easy Access Accounts That Secure Your Full Deposit:
When dealing with large sums of money it can be nerve-racking putting your money in an account that only guarantees your money up to £85,000. These options offer you full protection for your money.
- NS&I Income Bonds – (3.45% AER Variable) | min £500 / max £1m | Online/Phone
- NS&I Direct Saver – (3.4% AER Variable) | min £1 / max £2m | Online/Phone
Best Fixed Rate Accounts
Below you will find the best Fixed rate savings accounts which are great for long-term savings. We have listed the highest-rate accounts for Terms of 1 – 5 years.
| Provider | Account Type | Term | Rate | Min Opening Balance | Apply |
|---|---|---|---|---|---|
| NS&I | 1 Year Fixed Rate Saver | 1 Year | 6.2% | £500 | Apply |
| Ford Money | 2 Year Fixed Rate Bond | 2 Years | 6.05% | £500 | Apply |
| Cynergy Bank | 3 Year Fixed Rate Bond | 3 Years | 5.95% | £1 | Apply |
| Cynergy Bank | 4 Year Bond Issue 14 | 4 Years | 5.75% | £1 | Apply |
| JN Bank | 5 Years Fixed Rate Bond | 5 Years | 5.8% | £1000 | Apply |
Best Regular Saver Accounts
Just starting to save and don’t have a lump sum? Regular savers are a great option to get the best possible interest on monthly savings.
| Provider | Account Type | Rate | Minimum Monthly | Maximum Monthly | Apply |
|---|---|---|---|---|---|
| Nationwide | Current Account Linked Regular Saver | 8% | £1 | £200 | Apply |
| First Direct | Regular Saver Account | 7% | £25 | £300 | Apply |
| Lloyds Bank | Club Lloyds Monthly Saver | 6.25% | £25 | £400 | Apply |
| Natwest | Digital Regular Saver | 6.17% | £1 | £150 | Apply |
| RBS | Digital Regular Saver | 6.17% | £1 | £150 | Apply |
| Halifax | Regular Saver Account | 5.50% | £25 | £250 | Apply |
Best Notice Accounts
| Provider | Account Type | Term | Rate | Minimum Opening Balance | Apply |
|---|---|---|---|---|---|
| Stafford Railway BS | 120 Day Notice | 120 Days | 5.75% | £5,000 | Apply |
| RCI | 95 Day Notice | 95 Days | 5.6% | £1000 | Apply |
| Oxbury Bank | 180 Day Notice | 180 Days | 5.59% | £1000 | Apply |
| Cynergy Bank | 120 Day Notice | 120 Days | 5.55% | £500 | Apply |
| Oxbury Bank | 120 Day Notice | 120 Days | 5.53% | £1000 | Apply |
Different Types Of Savings Accounts Explained
With so many savings accounts available, it can be hard to know what account you should choose. Below we have explained the difference between each of the accounts and provided some scenarios where you might want to choose one over another.
Easy Access Savings Accounts
An easy-access or instant-access savings account allows you to withdraw and deposit your money at any time without incurring penalties or losing interest. These accounts usually don’t require much money to open and allow you to save relatively large amounts of money.
Rates on these accounts can vary wildly between different providers and will normally have a lower rate than fixed-rate or notice savings accounts.
This account is best used for money you need to use in the near term (less than 1 year).
Regular Savings Accounts
Regular saver accounts are great for savers who do not plan to deposit a lump sum initially, but decide to invest money on a monthly basis. These accounts will have a limit on how much you can deposit each month but usually provide better rates than other accounts.
You will pay a fixed amount between £25 – £300 each month. Interest on these accounts is calculated daily or monthly and is usually paid out at the end of the 12-month term.
Some of these accounts will restrict withdrawals over the 12 months so you need to ensure you don’t need that money in the short term to benefit from the account.
Currently one of the best regular saver accounts is the First Direct Account.
Fixed Rate Bonds
Fixed Rate Bonds will pay a fixed rate of interest over a set period of time. You will find one, two, three, or five-year terms. By agreeing to lock your money up for a set period of time, you are usually rewarded with a better interest rate.
Also, locking your money up for longer will generally get you a higher interest rate. You can find these fixed-rate bonds available at both high street banks and online banks but the latter tend to offer better rates.
This type of savings method is best for someone who has a lump sum and doesn’t plan on needing the money for the fixed-rate term. If there’s any chance you might need it, one of the other accounts above is likely a better option.
Notice Savings Accounts
A Notice account requires you to give the provider “notice” that you are looking to withdraw the money. The amount of notice you have to give them will differ on each account. It’s usually anywhere from 30 to 180 days.
Some notice accounts will pay higher variable rates than easy access accounts but don’t require you to lock your money up for as long as fixed-rate bonds do.
If you don’t plan on needing the money for the next 6 months to a year and want to benefit from a better rate, notice accounts can be a good option. Just ensure you have a fully funded emergency fund before putting your money somewhere it can’t be accessed for a period of time.
Childrens Savings Accounts
Children’s savings accounts are essentially the same as adult accounts but for children. You can open an account for any child up to 18 with as little as £1. When children reach the age of seven they can start managing their money themselves, if the account allows it.
This can be a great way to start teaching your children about finances and get them used to saving and spending their money.
Cash ISAs
A Cash ISA allows you to save money and earn any interest tax-free. This is great if you have a significant sum of money and want to shelter some of it from interest. There are three types of ISAs available; Easy Access, Notice and Fixed Rate Cash ISAs.
Cash ISAs used to be a great place to put your savings but since the introduction of the Personal Savings allowance they have become less attractive. The personal allowance allows basic rate taxpayers to earn up to £1000 in interest tax-free and £500 for higher rate taxpayers. Additional rate payers do not get a personal allowance so a Cash ISA may be more attractive to them.
There are multiple types of ISAs such as Lifetime Cash ISAs and Junior Cash ISAs available. You can have multiple ISAs open at one time but cannot go over your Annual ISA Limit (£20,000 in 2023/2024 Tax Year).
Lifetime ISAs
Lifetime ISAs are another savings account you can open from 18 – 39. These allow you to save for your first home or later life. Currently, you’re allowed to put in £4,000 per year and the government will add a 25% bonus to your contribution.
You can only withdraw from a lifetime ISA when you are buying your first home, are aged 60+ or your terminally ill, with less than 12 months to live. If you withdraw for any other reason, you will pay a 25% withdrawal charge.
If you are saving for a house this is one of the best ways to maximise your down payment. You’re not going to get a 25% interest rate in any other account.
When Should You Use A Savings Account
A high-interest savings account is a great place to store any excess money that you won’t need on short notice. You should keep enough money in your current account to manage your monthly finances and any excess is probably better off in a savings account earning interest.
Savings accounts are ideal for storing your money over a short period. Right now, the UK is experiencing high-interest rates, which you can benefit from. Let’s say you’re saving up for a house; it’s wiser to deposit your money in a savings account that offers high interest. It’s usually not advisable to invest this money, since there’s a chance its value might decrease in the short term.
Your personal needs will determine the type of savings account that you end up getting. We have explained each of them above.
Savings Accounts vs ISAs
There is one key difference between savings accounts and ISAs. ISAs allow you to earn interest tax-free. Previously this made ISAs attractive to most savers however since the introduction of the Personal Saving Allowance they don’t provide benefits for smaller savers.
The Personal Savings Allowance allows you to earn £1,000 as a basic tax rate payer and £500 as a higher rate taxpayer. Additional rate payers get £0 allowance so ISAs become an attractive option for them.
If you are earning more than your personal interest allowance in interest it is wise to put some of your money in an ISA to minimise the tax you will pay.
Best Savings Account For Emergency Fund
If you are looking for a savings account for an emergency fund there are a few things you need to consider.
- The money needs to be accessible at any time with no notice
- No penalties for withdrawals
- Needs a maximum deposit higher than your emergency fund
When we look at these requirements, an easy-access account is clearly the best option. It allows you instant access to your money if you need it, perfect for emergencies.
Personally, I use CHIP as my emergency fund account. As of writing this, they are offering 4.51% on up to £250,000 of instant access savings. The app is also easy to navigate and connects directly to your bank so you can deposit and withdraw at any time.
Chip is an award-winning savings and investment app. They became popular with their high-interest savings account but also offer investment services and automatic saving.
- Market leading interest rates
- Easy to use app
- £85,000 Protected by FSCS
- 45p Per Autosave
- Limited Range Of Investment Products
There are also other options for easy-access accounts like the ones we mentioned above.
How To Find The Best Savings Account For You
Finding the best savings account for you will depend on a number of personal factors. Here are a few things you should consider when picking an account.
What Are You Saving For?
Knowing what you are saving for is an important factor in choosing an account. For example, if you are saving for a house you plan to purchase in 4 years, putting money in a fixed-interest account, locked for 3 years might be a good choice. However, if you are just trying to earn some interest on your extra money and might need it in the short term, an easy-access account may be a better option.
Will You Need To Pay Tax On The Interest?
If you have a lump sum you are looking to save you may earn more interest than your personal allowance. In this case, it may be a good choice to look at investing in an ISA to shelter your interest from Tax.
Do You Need Access To Your Money
If there’s a chance you will need access to the money in the short term, it would be wise to invest in an easy-access account where you can deposit and withdraw the money as you like. If you know you won’t need access to cash for a specific amount of time, fixed-interest accounts or notice accounts may be the better option.
Are There Any Bonuses Available?
Some accounts will offer bonuses for signing up such as introductory interest rates, insurance policies, or occasionally cash bonuses for signing up. If the bonus is significant compared to the interest you will earn, it may be worth opting for that account.
Get The Best Interest Possible
First, decide the account type you want to open and then find the best interest rate on that type of account. You can then use our tables above which will help you decide on the best rates available right now.
Look Out For Penalties and Restrictions
Always make sure to look at the details of your account. Some accounts will offer higher rates but penalise you if you withdraw the money early or restrict you to a certain amount of withdrawals.
How To Maximise Your Savings
To maximise the amount you save there are a few things you can do:
- Add money to your savings account on payday before purchasing anything else. This will ensure you are making savings a priority.
- Shop around regularly for the best rates. Currently, rates are changing regularly and better rates are appearing all the time. Bookmark this page to stay up to date with the latest accounts.
- You could also use a cash savings platform that allows you to move money between multiple bank accounts without having to open new accounts. This allows you to maximise your rate without having to apply for a new account each time.
- You can use savings apps to “Save While You Spend”. These apps will round up spare change or use AI to determine how much you can save each month. While these amounts seem small they do add up significantly over time. You can also set rules to double or triple your spare change each time.
Final Thoughts
Ensuring you are getting the best rate on your money is important, especially when inflation is so high. Hopefully, this article has helped you to understand savings accounts and choose a high-interest account that is suitable for you.
Feel free to bookmark this article as we update it weekly and monthly to ensure it is up to date with the latest accounts.
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