Instant Access Savings Account – Are They For You?

By | Last Updated: 6th March 2019 | This post may contain Affiliate Links

For most people in England, Instant Access Saving Accounts can be a popular choice. They’re designed to pay interest on your savings and allow you to withdraw money whenever you need to.

These types of accounts can be available for both adults and children, so they can be a great option for a wide range of the population. As you can see, this makes an instant saver account great if you’re planning for a specific purpose, such as buying a new car, saving for a child’s future, planning a wedding, need home improvements, saving for a holiday and more.

There’s lots of different reasons why UK instant access accounts could be ideal for your situation.

Why Open an Instant Access Savers Account?


You can normally save amounts which suit your budget, this can be small or large, you can also open an instant access account with a deposit of £1.

They can be ideal if:

  • You want to save at your own pace

  • Don’t like taking major risks with your money

  • Like to withdraw money

  • Potentially earn a better return than a current account

You generally won’t be charged for opening an account or for withdrawing money, however it’s important to read your providers terms and conditions so you know exactly what their rules are.

For an adult account, you’ll generally need to be aged 16 or above and be a resident of the United Kingdom for tax purposes. Most providers will let you have more than one saver account in sole or joint names. Equally, many may provide an ‘optional’ ATM card to withdraw money from cash machines around the UK.

In the UK many banks and building societies will offer this form of account, you can apply online, over the telephone or by going into a local branch directly. Remember before you do any of this, why not visit our fantastic deals and special offers section to see the latest offers available! Our team are constantly looking for promotions and banking deals to help members of the UK public.

Is there a Risk?


With most savings or investments, there’s always some form of a risk, this is just a nature of life. However, instant access accounts are generally considered to be a ‘safer option’, against high-risk alternatives.

UK instant access bank accounts can include:

  • Higher interest rates than current accounts, however it may not be as high as savings bonds or regular saving accounts. These tend to ‘lock’ your money in for a period of time, thus you won’t be able to withdraw the money

  • Your savings may not hold their ‘buying value’ in the long run. This tends to happen if the interest rate on the account is less than the rise in the cost of living – in other words, the interest fails to keep up with the rise of inflation

  • Banks and building societies can obviously collapse or go out of business. This usually rare, however you should always use a provider which is regulated by the FSCS, also known as the Financial Services Compensation Scheme. Most UK building societies and banks are part of it, please visit the Bank of England’s website for further details

  • If you’re account comes with a card to withdraw money from a cash point (ATM Machine), their may be a charge to do this, please read your providers terms and conditions to find out how this might affect you

Does Tax Need to be Paid on Earnings?


In the majority of cases, most UK consumers will need to pay income tax on any interest they receive from their savings. Normally basic rate tax is deducted at source; however, this isn’t always the case, sometimes it’s not.

In April 2016, the first £1,000 in savings is removed from income tax, however high-rate taxpayers have a smaller personal savings allowance of £500. Normally Instant access accounts that are ‘cash deposit ISAs’ will give you tax-free interest, so you won’t lose a penny of your return.

Your individual circumstances and tax situation will usually apply, it’s recommended to speak to an independent financial advisor if you’re unsure.

How to Open an Instant Access Account?


As previously mentioned, in England instant access accounts can be opened at banks and building societies. You can do this in person at your local branch, over the telephone or online. You can find great deals and offers from our Savings Page, please click on the link to find out further information.

For most people it can be easier to apply for a savings account with the bank they use for day-to-day transactions. This is because you’re more likely to have a good history with them.

If you plan on using a provider which you don’t bank with on a regular basis, you may need to pass their security checks. This can be standard things such as an Identity check, you’ll need to provide documents such as a Passport or Driving Licence. Other forms of ID can include a birth certificate, utility bill, recent bank statement, council tax bill and so on.

In some cases, you may also need to pass a credit search, this isn’t always necessary and is not always applicable. However, some providers may require this to be carried out, should you ‘fail’ you may be rejected for an account.