Post Office Instant Access

shown73

First 12 months at 4.75% may not be market leading, but the restrictions on this account seem very reasonable by comparison. Convenience of Post Office access, cash card for a zillion machines, six free withdrawals yearly, and only £1 for over six. Am I missing something, (again!) or is this not a bad deal for people who would just like to park their wedge, but at a reasonable interest rate, and have easy access just in case? I'm fed up with he petty conditions/restrictions with other, so-called, high interest accounts, and this one seems pretty straightforward. Comments appreciated....

Kazza242

I agree, the Post Office Instant Saver pays a decent rate for the first year*. It is an account to consider for savers that can maintain the minimum account balance and are not expecting to make frequent withdrawals. As it allows 6 penalty free withdrawals, it is more flexible than some accounts like the one offered by First Direct. With the FD account, you do not receive any interest on your whole account balance for the entire month that you made a withdrawal.

Regarding the Post Office Instant Saver, the important things to take into account are:

- You receive 4.75% (soon to be 5.00%) interest provided your account balance remains at £500 or more.

- For every day your balance drops below £500, no interest will be paid.

- The account has a guarantee that promises to match BOE base rate until Jan 2008.

- *The rate includes a 1% gross introductory bonus for for 12 months from account opening. Assuming there are no more BOE base rate moves for 12 months, the rate will drop 12 months after you opened your account. First it will drop to base rate and then it will drop further once the guarantee expires.

- You can withdraw up to £1,000 per day at a branch or ATM.

The Post Office are increasing the rate on the Instant Saver from 4.75% to 5.00% on the 29th August. Therefore, I think this account is worth a look, but you have to be careful because it does have some restrictions. I think this account would only benefit those that:

- Can maintain a minimum £500 balance throughout the year.
- Do not intend to make frequent withdrawals.
- Wish to use this account as a short-term home for their money and are prepared to move on when the rate drops after 12 months or when the guarantee to track base rate expires.

shown73

I wasn't aware of the pending increase, very interesting. I believe that it is managed by the Bank of Ireland, so , pretty sound. What restrictions there are don't seem too onerous, but I just wonder whether the new rate of 5% will apply only to new savers, or also to existing ones also.

Kazza242

shown73 wrote:

I wasn't aware of the pending increase, very interesting. I believe that it is managed by the Bank of Ireland, so , pretty sound. What restrictions there are don't seem too onerous, but I just wonder whether the new rate of 5% will apply only to new savers, or also to existing ones also.

The Post Office are passing on the rate increase to both new and existing customers.

magpiejay

The interest on this account is only paid annually at the end of March. (But calculated daily). If you close your account after a year, but before year 2's interest is added, do you still get it?

shown73

Lots of accounts only pay annually, which is a bit of a bummer. Doesn't matter in the long run, I suppose, but it's nice to see a monthly increase. I suppose the argument would be that reduced admin costs mean more benefits to the saver. Hmmmm...