Saving Account Types
Type of Account | Features |
Instant Access Accounts | A good place to save emergency funds.They can pay more interest than a normal current account, and you can access your funds when required. |
Regular Savings Account | For saving a regular amount of your income. There are limits on how much you save and take out, you are likely to get a slightly higher interest rate. |
Fixed-Term Deposit Accounts | For saving money for a fixed length of time. A fixed rate of interest is set in advance, so you know exactly what your return will be. |
Index-Linked Accounts | Similar to fixed-term accounts, but the interest rate changes in line with inflation – you won't necessarily know the exact final return. |
Cash ISAs | A way of saving money TAX-free. You get an annual allowance. A Cash ISA is normally a simple savings account. You can get a Cash ISA from the age of 16, or a Junior ISA for under 18s. |
ISA's
Getting a good return on your savings is difficult presently, using your tax-free ISA allowance will help make your money work harder. During this tax year, which ends on 5 April 2019, you can save to £20,000 into ISAs and you don't pay any tax on the interest you earn.
You cannot carry forward your ISA allowance into a new financial year, so if you can afford to, it is worth using the full allowance each year.
You can open one cash ISA, one stocks and shares ISA and one IFISA per year. They can run simultaneously, and you can invest up to £20,000 per year spread over the accounts. There is no limit on how many ISAs you can have, just the amount you can open per year.
You can save or invest your annual limit into the same ISA, year after year - put simply, you could continue to save into an ISA you opened in 2010, but the amounts involved would be deducted from your allowance each year.
In addition, if you take money out of the ISA – to buy a car, for example – you are allowed to replace that money during the same year without it counting toward your £20,000 allowance. This rule changed in 2015, as previously any money you took out of an ISA could not be replaced - you could only add to the account from your unused annual allowance.
As a result of this enhanced flexibility, ISAs may appeal to people who previously would have opted for bonds or ordinary savings accounts.
Compare ISAs
It is important when considering starting a new ISA that you compare the wide range of ISAs available. Each ISA will pay different levels of interest. Naturally, you want to select an ISA which offers you the greatest return, meeting with a financial adviser will help you determine the best ISA for your money.
Bonds
How bonds work
Did you know?
• Banks and building societies are no longer providing face to face advice – insurers pulled out of the same service years ago leaving many people left on their own in need of ongoing advice. This applies to not just pensions but also investments such as Bonds and ISAs. • Bonds and ISAs incur annual management charges just like pensions – modern platforms for ISAs can be far cheaper than the traditional ISA whilst also providing a far broader range of investments funds which in turn provides greater levels of growth. • ISAs can be transferred from one provider to another just like a pension, Bonds can be surrendered (the majority of which are penalty free these days) and placed into an ISA for tax efficiency purposes as well as increased fund choice, performance ,and improved management. However, the surrender of a bond can be complex – in some circumstances, it may not be feasible. • As an example – someone has previously received advice from Lloyds - they will have arranged a Scottish Widows ISA offering approx. 20 different investment funds whilst incurring an annual management charge of approx. 1.5%. Their money will be placed into the Scottish Widows Mixed Fund (all of it) which is predominately invested in the UK. As an example you could possibly transfer an ISA to the Aviva Platform where they will have access to over 1400 investment funds (including Scottish Widows Funds), reduce the annual management charge to approx. 1%, place your investment into a wider portfolio of global funds with reduced risk via increased diversification with the added benefit of improving future performance whilst gaining ongoing servicing and advice which you no longer receive from the bank. • Meeting with a financial adviser could improve the performance / reduce risks / reduce the costs / consolidate your investments to give you a better outcome.
Book a reviewBook a ISA or Bond Review
Is my money safe?
The FSCS savings protection limit is £85,000 (or £170,000 for joint accounts) per authorised firm.
It is worth remembering that some banking brands are part of the same authorised firm.
If you have more than the limit within the same bank, or authorised firm, it’s a good idea to move the excess to make sure your money is protected.