Finance: Expert on impact of inflation on savings accounts
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Interest rates on savings have been notoriously poor recently, failing to incentivise people to put their money away. While it could prove a boost to the UK economy if people spend, some individuals will still remain steadfast in their goal of saving money. Fortunately, the situation appears to be turning around, as a few providers emerge from the doldrums of interest rates over the last year and a half.
One of these is Cambridge Building Society which is offering a particularly attractive interest rate that tops the tables of offerings.
The provider’s Extra Reward Regular Saver is currently offering an interest rate of up to five percent.
It can be opened by various means including in branch, by phone or via post.
The minimum amount required to open this account is £100, meaning it is suitable for many of those just getting started on their savings journey.
People will be able to save up to £3,000 with this account, meaning they can deposit up to £2,500 per month.
The overall maximum holding by any one person in respect of all accounts with The Cambridge is £2,000,000 – leaving lots of room for savings flexibility.
However, there are strict rules about who will be eligible for this kind of account with the provider.
If a person has been a member – holding savings or a mortgage – with the CBS for at least three years, it is at that point they will qualify for its five percent account.
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They will only be able to hold one Regular Saver account with the Society at any one time.
However, for those who have been a member with CBS for less time, there is an alternative option.
The Reward Regular Saver offers a fairly competitive three percent, still putting it close to the top of the table.
Britons will need to have been a member with CBS for at least one year in order to qualify.
For those who are eligible for the five percent offering, however, the building society has explained further details.
People will earn interest from the day they pay funds into their account until the day before the account matures.
The interest rate is fixed, meaning Britons will know exactly what they are getting at the end of the term.
The account can also be managed by post, by phone or in branch, and deposits can be made at any time as long as they do not exceed the limit.
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There is no penalty for missing a month but savers will lose their deposit allowance for that month.
It is worth noting withdrawals are not permitted during the fixed rate term.
Closure is allowed subject to a 90 day interest penalty fee, and this will be taken from a person’s capital balance if they haven’t built up enough interest at the time of closure.
In addition, no tax is automatically deducted from the interest paid on the account.
However, people may need to pay tax on any interest which exceeds their Personal Savings Allowance.
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