Which fixed term savings accounts allow withdrawal for a fee?

sturgeon

I’ve found it advantageous to open ISA accounts with high interest rates and a small exit penalty (ie 60 day’s interest) opposed to easy access savings accounts. I’m now more likely to have a decent savings pot for a year or so before a property purchase but still don’t want money locked away just in case. 

I’ve noticed first direct pay 5% on their fixed rate savings and allow closure of the account with full interest for a £100 fee. So on £85k savings, in just under 2 months the difference between 5% and my chip easy access at 4.2% would mean the additional interest I’d accrue is £100 more than chip and after that time I’m in profit. 

Any other fixed savings offer a penalty for closure but full interest? 

kaMelo

There may be the odd one or two but generally, non ISA fixed rates accounts don't allow withdrawals for any reason bar a significant life event.

BooJewels

What about a longer term notice account?  I think their interest rates fall somewhere between easy access and fixed rates and for a house purchase you'd have decent notice of when you'd need the funds.


ETA:  There is a thread here about notice accounts - if you start at the end (where I've linked to), there are posts about current rates. 

Middle_of_the_Road

Halifax 1 year 4.8% (4.85% current account holders) with 90 days loss of interest
Halifax 2 year 4.85% (4.9% current account holders) with 180 days loss of interest

Lloyds 1 year 4.95% (5% current account holders) with 90 days loss of interest
Lloyds 2 year 5% (5.05% current account holders) with 180 days loss of interest

fabsaver

NatWest and RBS fixed term savings allow early closure with 35 days notice and maximum 90 days loss of interest.
"The Early Closure Charge will be the lower of the amount of interest earned on your account or 90 days’ interest."

Current rates 5.01% AER 1 year and 5.12% AER 2 year.

https://www.natwest.com/savings/fixed-term-savings-account.html
https://www.rbs.co.uk/savings/fixed-term-savings-account.html

sturgeon

Thanks all. So far the first direct at 5% with £100 fixed penalty for withdrawing is best based on the full £85k. 

BooJewels

My calculations suggest that a 90 day notice account paying 4.9% will actually beat the fix at 5% at any period under about 14 months (£85 difference over a year) - but we're talking modest differences - and they may not be worth it for relinquishing a bit of convenience - depending on how easy it is to get your money out of FD. A 4.95% notice account makes it a bit more interesting.

fabsaver

I have discovered another option with HSBC. However early closure is only permitted if the balance is under £50k. Current rates (5.05% - 5.1%) are certainly not market leading either.

https://www.hsbc.co.uk/savings/products/fixed-rate/

Provided the deposit is under £50,000, you can close the account early for a fee of 90 days’ interest.

Alicon88

Sorry if it's a bit of dumb question

considering a deposit of 85K - to have an early closure with Lloyds means they will charge 3 months (interest rate I opened the account was 5%) so roughly 1k ?

Is it correct 

BooJewels

I make it £1,047.95.

5% interest on £85,000 = annual interest of £4,250 / 365 x 90 = £1,047.95.

Alicon88

BooJewels said:

I make it £1,047.95.

5% interest on £85,000 = annual interest of £4,250 / 365 x 90 = £1,047.95.

thank you