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What to consider when opening a savings account
Everyone has different financial goals, both long and short term. These will determine whether you can put money aside, influence the type of account you choose and how much you want to save. We offer a wide range of different savings accounts and can help find the best one for you.
As part of our commitment to helping you make an informed decision, here are some things to consider when you choose a savings account.
- Does a savings account work for me?
- What commitment do I need to make?
- What else should I think about before I commit?
Does a savings account work for me?
It is important to think about saving for the future as you never know what’s around the corner. Spend some time considering what you want from a savings account and how you want to save – do you prefer to put money aside each month, save some spare cash when you can, or put a lump sum away?
Also check that you can use the account as and when you like (online, by phone or in branch). To find the one that works best for you, it’s worth comparing different accounts.
What commitment do I need to make?
Some of our accounts can be opened with just £1, but to open others you will need to save monthly or deposit a lump sum – click here for further information on our range of savings accounts. Before you open an account, you should work out how much you can reasonably afford to save regularly or as a lump sum.
Your money grows from interest being added and the best way to build up savings is to leave your money untouched for as long as you can and to add to it – remember small regular payments can soon add up.
What else should I think about before I commit?
If you’re considering an account that means leaving your money untouched for a period of time, then also consider opening an easy access account for emergency funds. You should think whether you want interest to be paid monthly or yearly, and whether you want an account with a fixed interest rate. If you choose an account with a variable rate don’t forget the rate of interest can go down as well as up. Also, try to make the most of tax free savings accounts to make your money work even harder.
Before you open a savings account, take time to review your financial position as a whole. Most importantly, you should think about paying off any expensive debts, like credit cards, because the interest you pay on borrowed money is often higher than the interest you get on a savings account. Check the rate you are paying. You may also like to consider investment products, which can offer better returns over the longer term, but also tend to be more risky so you may not get back what you put in.
As a rule, savings accounts are low risk. But in the unlikely event something happens to us, we are a member of the Financial Services Compensation Scheme so our customers' savings are protected (up to £35,000).
Next Steps
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Find out more about our range of savings accounts. |
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If you'd like to discuss our savings accounts and your finances in more detail, why not have a face-to-face review in branch? Find out more about our Customer Review service. |
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Let us help you choose the right account with our Savings Selector |
