What are the Different Types of Savings Accounts?

When it comes to saving money, it’s always important to choose an option that’s right for you. Understanding the different options available can help you choose the best account for your own savings goals.

Easy Access Savings Accounts

‍These accounts are ideal for those who want to save money and earn interest on their savings, but also enjoy access to their money at any time. They allow customers to deposit and withdraw money at will, usually with no penalty. See our Chip Instant Access account.

Interest rates tend to be variable and can be changed at any time (usually with a notice period from the bank). They are a great option for getting interest on money you may want to spend immediately or may need to use because of an unforeseen expense. Learn more about instant access accounts.

Fixed Rate Savings Accounts

‍These accounts offer customers a fixed interest rate for a set period of time. This is usually between one to five years. This type of account is ideal for those who want to lock in a high-interest rate and can leave their money untouched for a set period.

Fixed-rate savings accounts are ideal for people who want to save for a specific goal, such as a down payment on a house or a vacation. However, customers may not be able to access their funds during this period without incurring a penalty.

Regular Savings Accounts

‍A regular savings account is designed for customers who are looking to save a fixed amount of money on a regular basis. They tend to offer higher interest rates than other types of savings accounts in return for regular deposits.

They are a good option for those who want to save smaller amounts of money, but may not have a lump sum to deposit. However, there are usually restrictions on how much you can deposit and the number of withdrawals allowed, and customers may have to pay a penalty to access their funds. More savings accounts.

Cash ISA

‍An ISA (individual savings account), is a type of tax-free savings account that is available to UK residents. They allow customers to save money without having to pay tax on the interest earned. 

They can be a great way to save for the long term and make the most of your money should earnings from other savings accounts mean you max out your personal savings allowance.

Chip does not provide tax advice. Tax treatment depends on individual circumstances and may be subject to change in the future.

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Children’s Savings Accounts

‍These savings accounts are for children under the age of 18 and tend to offer higher interest rates than other types of savings accounts. 

They are a great way for parents to help their children save money and learn about personal finance or for parents to start putting money aside for their children's future. Many children’s savings accounts also come with educational resources to help kids learn about saving and managing money.

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Chip does not provide tax advice. Tax treatment depends on individual circumstances and may be subject to change in the future.

Remember When Choosing a Savings Account

When looking for the right savings account, it’s important to consider the interest rate, any fees or penalties and any restrictions on deposits and withdrawals. Additionally, comparing different types of savings accounts can help you find one that suits your needs. 

It’s important to consider your own savings goals when looking for the right account. Whether you’re looking for a high-interest account or a tax-free savings option, Chip offers a range of savings account for you.