Instant Access ISA vs Natwest Savings Builder Account

CaoimheK101

Hello there,

I am hoping for some advice on Savings/ISAs.

Currently I save £300-£400 per month in an Instant Access ISA through my bank, with an interest rate of 0.1% AER variable. I have seen a “Savings Builder Account” now advertised through my bank, which offers 1.50% AER variable, once at least £100 is deposited each month (and 0.10% AER if the £100 deposit is not met). This sounds like a no-brainer to me, to switch where I save to the Savings Builder Account.

Am I missing any reason why this might not be a good idea? It is important to me that I do have access to these savings without notice, in case of emergency.

Thanks in advance!

Eco_Miser

The major reason it might not be a good idea is because you could be getting 5% with Nationwide, provided you could divert £1000 a month through their FlexDirect current account (which is easy for most savers).
If you want to stick with NatWest, definitely 1.5% beats 0.1%.

Have a look at these other regular savings accounts.

isasmurf

You don't have to save with your bank. You can get better rates with Virgin's regular savers (2.25%) or Nationwide's regular saver (2%*). Both allow withdrawals and no requirement to fund every month.

*A higher rate of 5% is available if you are willing to open an eligible Nationwide current account (you don't have to transfer your banking)

EachPenny

CaoimheK101 wrote: »

...which offers 1.50% AER variable, once at least £100 is deposited each month (and 0.10% AER if the £100 deposit is not met).

...It is important to me that I do have access to these savings without notice, in case of emergency.

The terms and conditions actually say you have to increase (grow) the balance by £100 per month, it isn't a case of adding £100 which you can then withdraw. For example, if you paid in £500 one month the most you could take out that month would be £400, otherwise you only get the lower interest rate. If you are expecting to need instant access to the money for any kind of emergency then you would only get a very poor rate of interest.

The advice of others on this thread about other current accounts and regular savers with different banks is very good advice.

If (as it sounds) your current account is with NatWest you might want to look at moving that as well as your savings. There are lots of current accounts which are more attractive than NatWest's, and some banks pay a switching bonus of £100+ if you transfer your account to them.

As you say, it is a no-brainer