Coventry Building Society has launched a new online savings account with a market leading interest rate of 3.15% AER. How does this fair with other savings accounts currently available?
The new Online Saver account is available from today, 9 March 2012, and is entirely operated online. The interest rate of 3.15% AER gross includes a bonus of 1.15% for the first year the savings account is open.
The minimum investment for the account is £1 and the maximum £250,000. Up to four withdrawals can be made in each 12 month period without penalty. Further withdrawals can be made but are subject to a charge equivalent to 50 days interest on the amount withdrawn.
Interest on the account can be paid annually or monthly and the minimum age to open an account is 16 years.
Colin Franklin, Sales and Marketing Director at Coventry Building Society, commented: “For savers looking for flexibility without having to compromise on the rate, our Online Saver account is perfect”.
MoneyHighStreet comments: “As the tax year end approaches it is interesting to see the inducements being offered to tempt savers to open savings accounts or ISAs with various institutions.
For example, as well as this savings account from Coventry, Principality Building Society has today announced positive changes to its fixed rate Cash ISA range.
Their 1 year fixed rate Cash ISA Issue 89 pays 3.00% tax free p.a./AER and 18 month fixed rate Cash ISA pays 3.35% tax free /3.22% AER.
Of particular note too are the new market leading cash ISA rates from Cheshire Building Society.
Their Direct Fixed Rate ISA – Issue 3 is an 18 month fixed rate cash ISA paying 4.05% tax free (4.00% AER) on balances of £1,000 or more. Interest is paid on maturity and is paid back into the account. Withdrawals are not permitted during the term of the account but closures can be made subject to 180 days’ loss of interest.
Their Direct Cash ISA – Issue 1 offers 3.35% AER tax free (variable) and includes an introductory bonus of 2.35% tax free until 30 September 2013. It is open to new subscriptions only and available to savers who have not started to use their 2011/12 cash ISA allowance of £5,340. As many deposits and withdrawals as required can be made.
If you’ve already used your ISA allowance and are looking for an alternative savings account, Tesco Bank is also now offering customers an interest rate of 3.25% Gross/AER (annual interest) on its 1-year Fixed Rate Saver. This allows a single deposit between a minimum of £2,000 and a maximum of £5 million that must be made within 30 days of opening. Once a customer has put their money in they can’t close the account early or get money out before the end of the term.
Of course you need to make your own personal finance decisions based on your own specific circumstances, seeking professional advice as appropriate.
Don’t just think about new accounts though, do also check what interest rates you are getting on other savings accounts you already have. It may, for example, pay you to swap them to get a better rate.
Don’t forget children’s savings accounts too if appropriate. There’s the Junior ISA for example.