Should I be using a Notice Savings account?

July 3, 2020

Enable’s IFAs in Bishop’s Stortford know that savers continue to be disheartened by the continuing fall in easy access savings rates. If you have some savings that you want to put in the best possible place for the short term you could consider a notice account. Some notice accounts are currently offering an average rate that’s 0.34% higher than that from easy access accounts.

Currently the average rate on notice accounts stands at 0.60% today, which compares to the average rate of just 0.26% for easy access accounts. “The notice account market may be overlooked for the greater convenience of an easy access account or the chance to earn a higher rate of interest on a fixed bond, however right now these could be the perfect bridge between the two,” says Rachel Springall. “Notice accounts are a more niche area of the savings market, but they can provide an attractive return compared to easy access accounts. Savers must give notice to access their money and this requirement enables providers to offer a higher return than on easy access accounts. In fact, over two-thirds of the notice account market will pay 0.50% or more, whereas only a quarter of the easy access market will do the same.”

Notice account rates are not necessarily the perfect answer as their rates have been falling too.  Savers need to be aware that with a notice accounts a notice period needs to be adhered to before money can be accessed, it can mean that if the provider reduces their rates, savers could find themselves stuck on the lower than expected rate and be unable to withdraw their money without incurring a penalty. 

Enable’s IFAs of Bishops Stortford know that there is no one size fits all solution to savings accounts and investments. In these uncertain times it is obviously wise to be saving if you possibly can but not necessarily so clear what to do with your savings in the short or long term. If you want some wealth management advice for your savings and investment accounts Enable’s experienced IFAs are here to help. 

https://moneyfacts.co.uk/news/savings/notice-accounts-rates-continue-to-beat-easy-access-accounts/

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