Here's our guide to savings accounts. Find out how they work, the types we offer and how you can get into the habit of saving.
When you save with us, you become a Nationwide member.
What's on this page
How savings accounts work
Savings accounts provide a place for you to put your money aside. You’d use these accounts to help you save up for when you need it. They aren't meant to be used for day-to-day spending.
There are many types of savings accounts, with different rates and terms. You'll earn money on your savings based on your account's interest rate.
Types of savings accounts
Our range of savings accounts offer different options for accessing your money. These can include:
Instant-access savings accounts
You can pay in and take out money whenever you need to.Limited-access savings accounts
Often offering a better interest rate than an instant-access account. The difference is that you'll be limited to a certain number of withdrawals in each account year to keep that interest rate.Fixed-rate savings accounts
A way to save a lump sum for a fixed amount of time. Your interest rate is fixed, so it won't go up or down. For some fixed rate accounts, you can’t take out your money before the term ends. For others, it's not possible to take out money without paying an early-access charge.
Choosing the right savings account
What you're saving for can affect the account you choose. Some savings accounts we offer are designed for a specific purpose.
The difference between an ISA and other savings accounts
A cash ISA is a type of savings account where the interest you earn is tax-free. So you could get more for your money.
The amount you can put in an ISA is set by your ISA allowance. This is the most you can save in an ISA in each tax year. For 2023/24, the allowance is £20,000.
Like other savings accounts, cash ISAs can also offer different options for accessing your money. These can include: limited access and fixed rate cash ISAs.
Regular savings accounts
Regular savings accounts are specific accounts that can help you get into the savings habit. They usually come with limits on how much money you can put into your account each month.
Children’s savings account
Our FlexOne Saver account is instant access and designed for children aged 11-17 who hold a FlexOne current account.
Business savings accounts
You can't use our personal savings accounts if you want to save for your business. Instead, our business savings accounts can help you make the most out of your organisation’s cash reserves.
Paying tax on your savings
When you save, you may have to pay tax on the interest you earn on your savings.
As a saver you have what's called a Personal Savings Allowance (PSA). Your PSA is the most you can earn in interest on your savings before you're taxed.
How much your PSA is depends on the rate of income tax you pay. For example, basic rate taxpayers can earn up to £1,000 in tax-free interest each year.
Helping you save
Getting into the habit of saving can be difficult.
Our personal savings accounts can help you get started. Whether it's putting away a lump sum, or saving more regularly each month.
We also have a range of tools and guidance for our members to help make saving easier. Like setting up our Impulse Saver tool in our Banking app.
Protecting your money
The Financial Services Compensation Scheme (opens in a new window) (FSCS) is a free, independent service that protects up to £85,000 of your eligible money at Nationwide.
As a seasoned financial expert with a comprehensive understanding of savings accounts and personal finance, I can delve into the intricacies of the concepts presented in the article on savings accounts. My expertise is grounded in a thorough knowledge of banking practices, investment strategies, and tax implications related to savings.
The article begins by outlining the fundamental function of savings accounts – providing a secure place to set aside money for future needs, emphasizing that they are not intended for day-to-day spending. This aligns with the basic principle of savings accounts as a means to accumulate funds over time.
The types of savings accounts are then discussed, showcasing a variety of options to cater to different financial preferences. The distinctions between instant-access, limited-access, and fixed-rate savings accounts are explained. Instant-access accounts allow flexible deposits and withdrawals, limited-access accounts offer higher interest rates but with restrictions on the number of withdrawals, and fixed-rate accounts lock in an interest rate for a specified period.
The article further explores the concept of Individual Savings Accounts (ISAs), highlighting their tax-free nature. A crucial point is made about the ISA allowance, which dictates the maximum amount one can save in an ISA per tax year. This aligns with the broader understanding of tax-efficient savings strategies.
Regular savings accounts are introduced as tools to foster a savings habit, with limitations on monthly deposits. Additionally, there is a focus on specialized savings accounts for children and business savings accounts tailored to the unique needs of organizations.
The discussion on paying tax on savings introduces the Personal Savings Allowance (PSA), explaining that it determines the tax-free interest threshold based on the individual's income tax rate. This aligns with the broader taxation principles applied to savings.
The article closes with a section on helping individuals save, addressing the challenges of forming a savings habit. Various tools and guidance, such as the Impulse Saver tool, are mentioned to facilitate the saving process.
In addition to these core concepts, the article provides links to related information on ISAs, ISA flexibility, savings promises, and the Financial Services Compensation Scheme (FSCS), emphasizing Nationwide's commitment to protecting its members' money.
In conclusion, my expertise allows me to navigate and explain the intricate details of savings accounts, providing a comprehensive understanding of the concepts presented in the article.
