Best savings accounts for 2016
When setting up savings accounts its important to consider how quickly you may want to access funds. There are a wide range of instant or easy access savings accounts on the market and also some where you need to give notice of your intention to withdraw funds, these often offer a higher interest rate. Don’t forget to use your ISA allowance so you can save tax free. Look out for regular savers accounts which offer you a high rate of interest for the first 12 months if you pay in a regular amount each month. You could switch to an ISA following the introductory period to make the most of your savings potential.
To find out more, have a look on the Money Advice Service website. There are a few different types of account available depending on how quickly you want to access the money, how long you plan on saving for and your attitude to risk as some are linked to investment markets. Instant access accounts offer the lowest rates but rates vary greatly across providers. Check out money supermarket for comparisons. Watch out for minimum deposits ranging from £1 to £3k plus.
Virgin Money (1.01%), Paragon (up to 1.46% var) and Skipton (up to 1.4% var) are currently have the highest rates on £1 deposit instant access accounts but shop around as new products are offered and withdrawn by providers throughout the year.
Charter Savings Bank, First Save, Yorkshire Building Society and Post Office have great rates on fixed rate savings accounts. Look out for minimum deposits as the Post Office ask for a minimum of £500.
With interest rates so low you might even consider just leaving your money in your current account. If you are planning on opening a new account Halifax offers £5 per month if you are in credit. Tesco Bank offers 3% on balances up to £3000 and TSB 5% on balances up to £2000.