A beginner’s guide to select access savings accounts

Saving for something chunky like a house deposit? Select access savings accounts (also known as ‘limited access' savings accounts) can make your money work harder, without locking it away for months or years. 

These accounts sit somewhere between an instant access savings account and a fixed-term savings account, and it’s a good idea to get your head around them if you’re serious about growing your savings. In this article, we’ll explain what makes them different from other savings accounts, and if one could be right for your big plans. 

What are select access savings accounts?

Select or limited access savings accounts do what they say on the tin – they restrict how often you can take money out of them. In most cases they limit the number of withdrawals you can make in a year, and offer a higher interest rate as a reward for keeping withdrawals to a minimum.

As a trade-off for limiting how often you can dip into your savings, lots of limited access savings accounts let you deposit money as often as you like. They often earn a higher interest rate than you’d get with a standard instant access savings account, too. 

Of course, these are just one of many types of savings accounts. It’s a good idea to have a look at all the options before deciding on the best one for you. 

What are the benefits of select access savings?

Before we dig into the good stuff, it's worth noting that limited access savings accounts aren't for everyone. They’re best suited to people who won’t need to dip into their savings for the next year – so if you’re working toward something specific that’s a little way off, read on.

The main draw of a select access savings account is the chance to earn more interest. Because you’re committing to fewer withdrawals, providers typically reward this with a higher annual equivalent rate (AER) than instant access accounts. And while withdrawals might be limited, many of these accounts let you deposit money freely and as often as you like. That makes it easy to keep building your savings at your own pace. 

Knowing that withdrawing regularly will reduce your interest rate can be a surprisingly effective way to keep your savings growing. Fixed-term savings accounts lock your money away for a set period and can charge penalties for early withdrawal. With select access accounts, there’s a nice balance of flexibility and incentive – you can access your money, but the motivation to keep earning higher interest often helps keep those longer-term goals on track.

What are the drawbacks of select access savings accounts?

There can be downsides to your money being less readily available. If you’re someone who regularly dips into your savings for everyday spending or unexpected costs, a limited access account might not be very practical. 

If you’re saving for something you’ll need money for within the next few months, or if you expect to make frequent, large withdrawals, a select access savings account probably isn’t the right fit for you, either. Put simply, you’ll be making it more difficult to get to your money, without the trade-off of earning more interest. That’s because your interest rate will fall to a lower level if you make more than the allowed number of withdrawals a year (typically more than two). With some accounts, that rate could end up being similar to what you'd earn on a standard instant access account. In that case, you might be better off going for the account with no withdrawal limits.

A few ways to save with Monzo

Our Select Access Savings and Select Access Cash ISAs are both limited access, and reward you with a higher rate for making two or fewer withdrawals per year. Your account also comes with handy features like roundups, which automatically saves your spare change, and Salary Sorter, which organises your salary as soon as you get paid. 

Monzo current account required. UK residents 18+ only. Ts&Cs apply. The taxes you pay depend on your circumstances and could change in the future. 

Questions? Answers.

What are select access savings accounts?

Select access or limited access savings accounts restrict how often you can withdraw money, usually to two or fewer times per year. In return, they typically offer a higher interest rate than instant access savings accounts. They’re best suited to savers with medium-term goals who won’t need regular access to their money.

How often can you withdraw from select access savings accounts?

You’re usually allowed up to two withdrawals per year at the higher interest rate. If you withdraw more than this, your rate will usually drop until your next account anniversary. You can still access your money at any time, but exceeding the limit will affect how much interest you earn.

What savings accounts have the best interest rates?

Higher rate savings accounts tend to be either limited access or fixed term, since you’re giving up some flexibility in exchange for a better return. The right account for you depends on how often you need to access your money and how long you’re comfortable saving for.

Are limited access savings accounts worth it?

They can be, especially if you have short-term savings goals and don’t need to access your money regularly over the next year. A higher interest rate savings account can help your money grow more quickly, as long as you’re confident you won’t need to withdraw often enough to trigger the lower rate.