When we have worked for much of our adult lives and invested the fruits of those labours in caring for our children and ensuring their smooth transition into independent living we find ourselves able to invest some of our surplus income in providing savings for our future. Naturally, we want the best return on our investments. As this brief article will exhibit, the issue of cash savings accounts and which one to choose is far from straightforward, particularly during periods of economic downturn where the financial institutions are reluctant to offer anything other that parsimonious rates of interest. The first account that we will look at is the current account.
The Current Account
For reasons that will become clear, buypsychedelicaustralia the current bank account is not one in which it is not always wise to invest your savings.
There are many current accounts that offer 0% interest on monies invested, regardless of the amount in the account. Obviously, being a current account you have unfettered access to your money and all the facilities that come with a current account, such as a cheque book and debit card but a combination of the low (or even non-existent) interest rates available and the fact that your bank is likely to have other savings options that are more beneficial and only marginally less flexible means that you should hesitate before leaving anything other than the bare minimum in a current account.
That means you should keep enough to service your monthly needs and ensure that any surplus is paid into a more efficacious savings account.
The next account we will look at is only slightly less flexible than a current account but it is almost certain to provide a greater return on your savings. This is the Easy Access Account. Deli Larchmont NY
The Easy Access Account
As its name implies, the easy access account offers a straightforward way of accessing your funds as and when you require them. However, there is likely to be a limit on the amount of money that can be withdrawn at any one time. Because the savings institution does not have the advantage of knowing that it will be holding the saver’s money for an extended period of time, as it does with some of the other accounts that we will examine later, the interest rates offered on easy access accounts are likely to be relatively low.
However, savers are likely to find that the easy access accounts that provide the most attractive interest rates are those that do not require an office or branch based organisation of the account. Accounts that can be run by telephone or, even more likely to attract generous interest rates, through the internet, cost the savings institutions less to administer and consequently they are willing to provide higher interest returns on savings.
Even with that advantage, however, it remains the case that Easy Access accounts are amongst the most unprofitable of savings products presently on the market. For accounts that provide a greater return the savings institutions want some guarantee about the amount and/or the length of the investment.
There are several types of accounts that savings institutions offer which provide higher interest returns on savings. These tend to be based upon the saver investing a fixed sum for a set period of time, freepornoavis on a fixed interest period subject to conditions or upon the saver investing a minimum regular amount into the account. The first of these that we will consider comes within the latter category and is most frequently described as a Regular Saver Account.
The Regular Saver Account
In simple terms, the Regular saver account is one into which the saver agrees to invest cash into the account on a periodic basis (conventionally this is monthly). Because the savings institution can rely upon receipt of cash on such a regular
However, foutatunisia savers are likely to find that the easy access accounts that provide the most attractive interest rates are those that do not require an office or branch based organisation of the account. Accounts that can be run by telephone or, even more likely to Regular Saver Account rewards investors who are prepared to pay an amount of money on a periodic basis (usually one month) into their savings account. Because the savings institution is able to operate on the basis that a fixed sum will be received it can provide what are, on occasion, some extremely attractive interest rates. However, there are certain conditions that apply to these accounts. Firstly, because the interest rates offered can be so attractive, there will be an upper limit on the amount that can be invested. If that upper limit is breached, it is likely that there will be interest penalties imposed, streetwear resulting in a much reduced interest return.
Equally, it is likely that there will be a limit on the number of withdrawals that the saver is permitted to make in a year. Once again, transgression against that condition is likely to result in penalties against the saver’s interest return. Nevertheless, for savers making only relatively small investments, who are able to see their cash tied up for a period, the Easy Saver can be a profitable option. The next type of savings account that we will consider is one where the rate of interest is higher than the standard current account or easy access account but where there are additional conditions affecting your access to your money. This is the Notice Account.
The Notice Account
In basic terms, the notice savings account is one where the saving institution offers a higher rate of interest in return for a condition on the account that requires the saver to give a minimum period of notice before making any withdrawal from the account.
The notice account is not appropriate if there is a possibility that you will require all or part of the funds urgently, or at least within the notice period applicable to the account. However, if you are able to have your cash tied up for the minimum notice period you can benefit from some enhanced interest rates.
It should be said that savers can still obtain access to their funds within the notice period if they urgently require them. However, in such circumstances the saving institution is likely to levy some quite Draconian charges.
There is a further variation on the type of account where the saver may have to commit to keeping his cash in the account. Other such accounts do not place such stringent requirements. The type of account that we will now consider is the Fixed Rate Savings Account.
The Fixed Rate Account
With a fixed rate savings account, the savings institution offers the saver a rate on his savings that will be fixed for a given period. This type of account is particularly useful when interests rates are likely to fall. Conversely, if interests rates rise, the account may well result in less of a profit that a variable rate savings account, such as a notice account, particularly if there are prohibitions against withdrawal for the account. Some advantageous interests rates can be found with these accounts, particularly those requiring that the funds remain in the account. Larger investments usually receive higher interest rates and the maximum investment can be relatively large. Interest can be taken monthly and this is not counted as a withdrawal from the account.