The Top Easy Access Savings Discussion Area

ColdIron

patpalloon said:

BooJewels said:

@patpalloon You can earn up to £18,570 in total before you would pay any tax, that could be made up of earnings, pensions and your interest.  So you could earn up to a further £4,570 (approx. £380 per month) before you paid any tax on your interest if it were nudged above the total of the allowances, see below. 

If you were to put your annual allowance of £20k into an ISA, the interest on that would be tax free, so you could add something in the region of £900 to your potential earnings before tax comes in to play.

Your allowances are made up of your (linked to Gov web page):

Personal Allowance = £12,570 - this could be earnings, pensions (inc State Pension) or in the absence of any, interest.

Your starting rate for interest, taxed at 0% = £5,000 - this is reduced pound for pound with any earnings above your Personal Allowance above.  (so if you earned £14,570 in a job, your starting rate would only be £3,000)

Your Personal Savings Allowance = £1,000 - the amount of interest taxed at 0%.

So, £12,570 + £5,000 + £1,000 = £18,570

Thanks, I understand all this - so only when my total income (interest + earnings goes over 18,570) I would start to pay tax which would then be at 20% of all income over the 18,570?

Not quite. Your Personal Allowance covers earnings and interest. The Starting Rate for Savings and Personal Savings Allowance only cover interest

It's important that you stack income and allowances in the right order. For a simple case of earnings and interest:

Income: Earnings then interest

Allowances: PA then (immediately) SRS and finally PSA (floating at the top if you like)

So if your earnings were in excess of £12,570 the portion above that would be taxed at 20% AND would reduce your SRS (but not the PSA)

So, say for argument sake I was earning 14,000 in interest pa and 10,570 earnings = total 24,570 - so  6,000 is taxable at 20% so £1,200 tax.

In this case yes because your earnings are less than your PA so you have the full £18,570 available to you

If I earnt 20,570 pa +my interest = 34,570 total income - 18570 = 16000 taxable at 20% so £3,200 tax.

In this case no. Only £12,570 earnings would be covered (by the PA) and the remaining £8,000 taxed so £1,600

Your SRS has been reduced to £0 by your excess earnings so unavailable to you

You only have your PSA left so £13,000 is taxable, another £2,600 tax

Result: £4,200 tax

You can't just knock £18,570 off the total, you have to apply the various allowances to the income that they apply to in the right order

Angelica123

Sepulveda said:

I'm a newbie here so if my question is a bit daft please forgive me! 

For context, I recently inherited a fairly decent amount of money. Until now, I knew little about how to get the best return on savings accounts etc (having not really been in the position to have a lot of savings), so the last few weeks have been a very steep learning curve. Thank you to everyone on this forum and on the fixed-savings board as I have learned a LOT from reading your posts - and found some great high-interest accounts!

To get to my question - I read on here about the Gatehouse 5.23% EA account being only open to existing customers. So I opened a Gatehouse 4.6% 95 day notice account, min £500 (not funded yet) and was then immediately able to open the 5.23% EA account (which now has £20k in it) - it's the best rate EA account I've found. (I have opened a number of EA accounts, an ISA fixed 5.65%, plus 3 fixed rate bonds, as I want to spread the money around).

What I'm concerned about is, if I don't fund the Gatehouse fixed notice account within the 30 day period, under the terms and conditions it will be closed. I don't really want to fund it as I have much better rates with my other accounts elsewhere, including with the Gatehouse EA. And I don't see the need to have a notice account. So if I don't fund it (and it closes), I'm assuming everything will still be fine with my Gatehouse EA account? i.e. they won't close it and tell me to !!!!!! off! As basically I opened the notice account only as a way to get access to the EA account, if that makes sense. Although I'm sure they know people do that?!

I did the same with Oxbury - opened the EA 4.94% to then get access to the Oxbury 6.01% 1 and 2 year bonds, which are now funded - but the difference is my Oxbury EA account does have the minimum of £1k in it.

Also, I wondered what proportion of your money do you put into fixes vs easy access? I found this hard to decide as I don't have a crystal ball, at the moment its about 40% in fixed rate bonds (1 and 2 year) and the rest EA.

Anyway, thanks again for everything you have all posted here, its been so helpful and I appreciate it!

I think the most important thing is to work out what you are saving the money for. Building an emergency fund? Buying a house? Saving towards retirement? Having 3-6 months of emergency funds in EA makes sense. You may want to consider notice accounts too 

Sepulveda

Angelica123 said:

I think the most important thing is to work out what you are saving the money for. Building an emergency fund? Buying a house? Saving towards retirement? Having 3-6 months of emergency funds in EA makes sense. You may want to consider notice accounts too 

Saving for the future really. What I have inherited is not really enough to buy a decent house (it was half of my parents estate, split equally with my sibling). I am early 50s and have a work pension. I live with my partner in tied accommodation that comes with his job. So I want to get the best return on this money (without any risk, therefore no investments etc). Apart from a holiday I have planned for next year, and some small purchases (like replacing my 8 year old ipad!) I'm not planning on spending this money at the moment. I just want to get the best return on it, hence all the high interest savings accounts.

Bridlington1

Sepulveda said:

Angelica123 said:

I think the most important thing is to work out what you are saving the money for. Building an emergency fund? Buying a house? Saving towards retirement? Having 3-6 months of emergency funds in EA makes sense. You may want to consider notice accounts too 

Saving for the future really. What I have inherited is not really enough to buy a decent house (it was half of my parents estate, split equally with my sibling). I am early 50s and have a work pension. I live with my partner in tied accommodation that comes with his job. So I want to get the best return on this money (without any risk, therefore no investments etc). Apart from a holiday I have planned for next year, and some small purchases (like replacing my 8 year old ipad!) I'm not planning on spending this money at the moment. I just want to get the best return on it, hence all the high interest savings accounts.

First of all welcome to the forum.

If you haven't already opened it there is also the Santander edge saver that pays 7% on balances of up to £4k. You need to have their Edge current account to be eligible for it, which ordinarily charges a £3 monthly fee but if you never set up any direct debits on the current account they never charge any fees.

As well as EA and fixes you may also want to look at regular savers. If you don't mind a bit of savings admin opening several regular savers and drip-feeding your EA savings into them can be a good way to increase the amount of interest you earn. There's a long running thread on regular savers here:
https://forums.moneysavingexpert.com/discussion/6106986/regular-savings-accounts-the-best-currently-available-list/p1

Also as a slight aside quite a few building societies have been known to offer high paying savings accounts exclusively to existing customers who have banked with them for however long. Off the top of my head Bath BS, Cambridge BS, Chorley BS, Coventry BS, Darlington BS, ESBS, Leek BS, Mansfield BS, Market Harborough BS, Monmouthshire BS, Newbury BS, Penrith BS, Principality BS, Saffron BS, Skipton BS, YBS have all offered products that are available exclusively to existing members. In order to become eligible for some loyalty rate savings accounts later on you may wish to open a few savings accounts with £1 with some of the building societies on the above list and then leave them there with a minimal balance.

Sepulveda

Bridlington1 said:

Sepulveda said:

Angelica123 said:

I think the most important thing is to work out what you are saving the money for. Building an emergency fund? Buying a house? Saving towards retirement? Having 3-6 months of emergency funds in EA makes sense. You may want to consider notice accounts too 

Saving for the future really. What I have inherited is not really enough to buy a decent house (it was half of my parents estate, split equally with my sibling). I am early 50s and have a work pension. I live with my partner in tied accommodation that comes with his job. So I want to get the best return on this money (without any risk, therefore no investments etc). Apart from a holiday I have planned for next year, and some small purchases (like replacing my 8 year old ipad!) I'm not planning on spending this money at the moment. I just want to get the best return on it, hence all the high interest savings accounts.

First of all welcome to the forum.

If you haven't already opened it there is also the Santander edge saver that pays 7% on balances of up to £4k. You need to have their Edge current account to be eligible for it, which ordinarily charges a £3 monthly fee but if you never set up any direct debits on the current account they never charge any fees.

As well as EA and fixes you may also want to look at regular savers. If you don't mind a bit of savings admin opening several regular savers and drip-feeding your EA savings into them can be a good way to increase the amount of interest you earn. There's a long running thread on regular savers here:
https://forums.moneysavingexpert.com/discussion/6106986/regular-savings-accounts-the-best-currently-available-list/p1

Also as a slight aside quite a few building societies have been known to offer high paying savings accounts exclusively to existing customers who have banked with them for however long. Off the top of my head Bath BS, Cambridge BS, Chorley BS, Coventry BS, Darlington BS, ESBS, Leek BS, Mansfield BS, Market Harborough BS, Monmouthshire BS, Newbury BS, Penrith BS, Principality BS, Saffron BS, Skipton BS, YBS have all offered products that are available exclusively to existing members. In order to become eligible for some loyalty rate savings accounts later on you may wish to open a few savings accounts with £1 with some of the building societies on the above list and then leave them there with a minimal balance.

Thanks for this. Regular savers - I have Nationwide 8% and TSB 6%, I have heard about Santander Edge saver but my main current account is not with them (and I'd been put off about the fees) but thats worth a thought if there is a way around it.

Interesting about the building societies - I have opened a Family BS savings account, and also a Skipton BR tracker (I was keen to get into Skipton!) I have already looked at some of the BS you mention, but not all - some of the BS you mention I haven't heard of, so I'll look at those - thank you!

Valley73

Decided to take out a EA and fixed rate with Metro Bank. When you apply for a fixed bond it says they open a funding account automatically. You then have 30 days to fund this account and then this is moved to the fixed bond. I wasn’t sure if the funding account is EA account?
So I opened the EA account first but now I cannot open a fixed bond. I get the message £500 min needed in EA account!

ColdIron

Valley73 said:

Decided to take out a EA and fixed rate with Metro Bank. When you apply for a fixed bond it says they open a funding account automatically. You then have 30 days to fund this account and then this is moved to the fixed bond. I wasn’t sure if the funding account is EA account?

It is an EA account but it is a separate EA account to the standard 5.22% one, you will have to open that separately. It's a 'holding' account until you add the amount of money you said you want to fix and then it's transferred out

So I opened the EA account first but now I cannot open a fixed bond. I get the message £500 min needed in EA account!

I assume this is the funding EA account for the fixed rate account and not the 5.22% one. Minimum balance is £500. How much did you say you were going to fix?

https://www.metrobankonline.co.uk/savings/products/fixed-term-savings

Valley73

No, I have the 5.22% EA one (once it gets to £500). I was looking at putting in £10k in a fix. But first I have to put that amount into EA before I can apply for the bond. Most other providers allow you to open the fixed bond and give you a funding window.

ColdIron

Valley73 said:

No, I have the 5.22% EA one (once it gets to £500). I was looking at putting in £10k in a fix. But first I have to put that amount into EA before I can apply for the bond.

The 5.22% one has nothing to do with the funding account for the fix (though both accounts have a minimum requirement of £500)

How many accounts have you applied for? I am guessing just the 5.22% one

You will need to apply for the fixed rate account in addition and that will open another EA account, i.e. the funding account

Most other providers allow you to open the fixed bond and give you a funding window.

Yes, Metro use this intermediate funding account but you still have a funding window

janusdesign

@soulsaver
Secure Trust Bank Access Account (Issue 9) - 5.10% (£1 - £250,000) is now NLA and replaced by...
Secure Trust Bank Access Account (Issue 10) - 5.00% (£1 - £250,000) - so drops out of your top 10.

the t&c I posted previously about Issue 9 also apply to Issue 10... the rate on my existing Issue 9 has not changed and ST would give 14 days notice if they intended to lower it.

for anyone who opened the account on Friday (certainly late afternoon / evening), it might be worth checking that you opened Issue 9 at the 5.10% rate.

Zaul22 said:

The Secure Trust App is new as well I think. They never had one a few months ago when their account was briefly year the top of the list. 

I got an email from them about it's launch last month - weird thing about the app is that it doesn't show previous Issues of the Access Account as closed - you literally can't tell any difference between a closed and open account... but when logging into the site, closed accounts show as red.

Cynergy Bank Online Easy Access Account (Issue 69) - 5.10% (including 1.10% bonus) - £1 to £1,000,000
I assume Issue 68 @ 5.15% is NLA.

i'll also mention in passing that there is a Paragon Bank Double Access Savings Account - Issue 5 paying 5.05%, but it currently wouldn't make the top 10.