What is a regular savings account?

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A regular savings account, also known as 'monthly savers' or 'regular savers' is one of the four main types of savings accounts. They’re a place to keep your money whilst it earns interest at the same time.

Regular savings accounts would work best for you if you are able to reliably set aside money each month. With a regular saver account, money is paid in each month and depending on the agreement, payments are usually anything between £10 and £500. These payments will end when the account’s term ends (for example after a year). A regular saver can be useful if you're saving for a special event like a wedding.

To open a regular savings account, you will probably need to have a current account with the bank you’re hoping to open your regular savings account with because when your regular savings account closes, your savings will often be transferred to this current account. A regular saver often works best for people who don’t mind having limited access to savings for a while.

They’re also good if you want a higher interest rate, as regular savings accounts often have higher interest rates than other savings accounts and current accounts. Your interest rate will be higher than if you invest a lump sum in a cash ISA or an easy access account. 

At the end of the term, you will get back all the money you've put into your regular saver. Your rate will drop if you miss a payment or take money out though so being able to set aside money each month is important! 

You may find both variable rate and fixed rate options when looking for regular savings accounts. How much access you have to your money can vary too. Rules vary between regular savers and so make sure you check before going with a regular savings account if you think you might need to take out money during the account term.

UK banks and building societies are regulated by the Financial Conduct Authority (FSA) and the money that you put into any bank in the UK is protected by the Financial Services Compensation Scheme (FSCS). Keep in mind, however, that the FSCS has a limit of up to £85,000 protection (and £170,000 for joint accounts), so make sure you check you aren't over this limit and that excess money is moved and protected.

If you’re looking for more information on regular savings accounts and other types of savings account, we've put together a quick summary of the main four. You’ll also find some helpful tips on choosing the right savings account for you!