If you’re a novice saver, chances are high that you’re going to have a lot of confusion when it comes to the type of savings that are available in the market. There are a wide range of savings products to choose from. To know which type is the best for you, you must first know what they are. Among the most common savings products in the UK include:
Instant Access Accounts
These accounts offer instant access thereby allowing you to use the money anytime without penalty. On the downside, the interest rates are lower than other types of savings products.
For notice accounts, you’ll have to notify your bank before you can make any withdrawals. These accounts offer higher interest rates but you may need to wait 30, 60 or 90 days before you can get your hands on the money.
Fixed-term Savings Accounts
If you are not going to touch your savings for a number of years, you can lock your money with a fixed term savings account. Because the money is locked in, the interest rates also tend to be higher than normal.
Regular Savings Accounts
If you want to set aside a fixed amount of money for savings each month, these accounts are perfect for you. The rates are also higher and the money can be deducted from your paycheck on a regular basis if you wish to. If you set it at £100 or more per month, for example, then that’s the amount that will go to the account regularly.
Over 50s Savings
For people who are over 50s or are on their way to retirement, banks offer a specific type of savings accounts with preferential interest rate. In addition, the savings product also comes with a number of additional services tailored to savers in this age group.