Easy access savings accounts

Easy access savings accounts 

An easy access account is one of the simplest types of savings account available to UK savers. It gives you the freedom to pay in and take out money at your leisure. And you can often open an account with as little as £1. Find out everything you need to know about easy access savings accounts.

What is an easy access savings account?

As the name suggests, an easy access savings account lets you withdraw money quickly and easily. You’ll earn interest on money you pay in and you can usually dip into your savings whenever you want.  
 
Because you have easy access, this type of account could be a good way to save for emergencies – if your car or boiler breaks down, for example – as you  should be able to get your hands on your money swiftly in a crisis. The Money Advice Service recommends having three months’ essential outgoings in an instant access savings account. 
 
But It’s worth noting that not all easy savings accounts offer instant access. There could be a short wait to take your money out, and you might not have unlimited access. So, it’s always important to look closely at the details before opening an account. 

How does interest work on an easy access savings account?

Pretty much all easy access accounts have variable interest rates. This means that the rate on your account can change at any time and either move up or down. Currently, the trend is very much downwards due to the ongoing COVID-19 pandemic, but in times of economic prosperity interest rates tend to be higher.

The amount of interest you earn will depend on the type of savings account you have and the Bank of England base rate. Most easy access accounts pay interest yearly, although you can get some that pay monthly.

Keep an eye on the interest you’re earning. If it no longer seems competitive, it could be worth moving your savings to an account that offers a better rate.

Is an easy access savings account right for me?

This depends on your spending habits, future plans and what your appetite for risk is. If you’re keen to start saving but still want to access your money for unexpected expenses, easy access accounts could offer a flexible and convenient solution. 
 
But if you have a long-term savings goal and don’t mind locking away your money for a while, you could benefit from a higher interest rate. Alternative savings options include cash ISAs and fixed-rate savings accounts. You could also invest in a stocks and shares ISA, but this is riskier than a savings account or cash ISA. That’s because, with a stocks and shares ISA, the amount your investment is worth may fall as well as rise. That means you could get a smaller amount of money back, than the amount you put in. 
 
Remember, you can always have more than one savings account. Many people choose to have one savings account for emergencies and another for long-term savings.  

What are the benefits of easy access savings accounts?

As well as allowing you to pay in or take out money when you choose, other advantages of easy access accounts include:

  • Simplicity – straightforward to set up and manage, sometimes with as little as £1
  • Build up savings – good for first-time savers and those who want to get into the habit of saving
  • Tax-free interest – you have a personal savings allowance limit, so you won’t pay tax on the first £500 to £1,000 of interest earned, depending on your tax band. For many people, that means saving is completely tax free

What are the downsides of easy access savings accounts?

An easy access account might not be the best option for you. Disadvantages include:

  • Low interest rates. The Annual Equivalent Rate (AER) - how much interest you’ll earn in a year - is usually lower than fixed-term accounts and even some current accounts
  • Restricted withdrawals. Some easy access accounts limit the number of withdrawals you can make in a year without losing interest
  • Urge to spend. If it’s easy to get your hands on your money, it can be tempting to spend it rather than saving it for a rainy day

Frequently asked questions

Are easy access accounts the same as instant access accounts?

They’re very similar in that they both allow you to access your money quickly, but there are some slight differences. 
 
An instant access account offers unlimited cash withdrawals and you can take money out with a cashcard, just as you would with a current account.  
 
With easy access, you might need to transfer the money from your savings account to your current account, before you can get your hands on the cash. There may also be limits on the number of times you can take money out. 

How much do you need to open an easy access savings account?

This can vary quite considerably. Most easy access accounts can be opened with just £1. But some need a deposit of £50 or £100, or more.  
 
When you compare with us, we’ll show you the minimum balance you need to have in your account. 

What is an easy access bonus rate?

There are easy access accounts that offer you a bonus introductory rate as an attractive incentive to open one. This is usually fixed for 12 months, after which it’s likely to drop like a stone. You should review your rate when the bonus ends. Also, there are sometimes conditions to the bonus. Foer example, not withdrawing money for a certain period after you open the account. 
 
It’s up to you whether you’d rather get the bonus and switch after a year, or choose an account without a bonus so you don’t have to keep moving your money around. That said, it’s always a good idea to keep an eye on how much interest you’re earning so you can make the most out of your money. 

How do I find the best easy access savings account?

To find the best instant access or easy access savings account for your circumstances, you'll need to think about:

  • The interest rate and whether there’s an introductory bonus
  • How much you need to put in when you open the account
  • How you want to manage the account (online, by phone or in branch, or all three)

The best easy access savings rates might have rules or restrictions attached. For instance, a higher initial deposit or limits on cash withdrawals.

Who can open an easy access savings account?

To open most easy access savings accounts, you’ll need to be a UK resident aged at least 16. For some accounts, you’ll need to be 18 or over. 

How do I open an easy access savings account?

You can open an easy access savings account with a bank or building society, either online, over the phone or by going into a branch.  
 
In some cases, you may already need to have a current account with the provider before you can set up a savings account. 

Is there an easy access savings account with a high interest rate?

You can find top easy access accounts that have a higher rate than others by doing a comparison. Bear in mind that the best easy access savings rates might be available with online-only accounts, or restrict the number of withdrawals you can make in a year. They might also offer a 12-month introductory bonus rate, which means you'd automatically be moved on to a lower rate of interest after you’d held the account for a year. 

Is my money safe in an easy access savings account?

All easy access savings accounts offered by regulated UK banks and building societies are protected by the Financial Services Compensation Scheme. This covers up to £85,000 of your savings per financial institution, if it goes under, and as much as £170,000 if it’s a joint account.

Can I manage my easy access savings account online?

Not necessarily. Some savings are managed in-branch only, so make sure you check before you open the account if this is something that’s important to you.

Tiered Rates

Interest rates can go up or down as the amount you deposit increases, depending on the savings account. So, you could be paid a different rate of interest, based on how much money you’ve deposited. Typically, the greater the deposit, the higher the rate of interest would be. But that’s not always the case, so it’s worth checking what the rates are, before you apply. 

What do I need to compare easy access accounts?

When you compare with us, we’ll list the results by interest rate AER, from highest to lowest, and show you how much you’ll need to deposit to open an account. 
 
If you decide to apply, we’ll take you to the provider’s website so you can give them your details. 

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James Padmore

Money product expert

What our expert says

“Easy access savings accounts can be a good choice if you need to access your savings at short notice, but they don’t tend to offer the best interest rates. When you compare, watch out for how you have to manage the account, whether unlimited withdrawals are allowed and if there’s a bonus rate that will plummet after the introductory period ends.”

Why use Compare the Market?

We compare easy access savings accounts from online providers, major banks and building societies Compare savings accounts in under 1 minute** 93.8% of users would recommend Compare the Market to friends or family***

 **On average it can take less than 1 minute to complete a savings account comparison through Compare the Market, based on data in November 2020. 

***For the period 1st September to 30th November 2020, 12,477 people responded to the recommend question. 11,706 responded with a score of 6 or above, therefore 93.8% are likely to recommend 

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