Industry experts have recently recommended consumers looking to recover after a Christmas season heavy on spending to turn to instant access savings accounts in the New Year, calling them the ‘first port of call’ for savers.
The most popular personal and business bank account providers offer instant access accounts that allow you to make deposits and withdrawals without limitation, which could be useful in the event of needing to access your cash at a moment’s notice. However, industry experts recommend using instant access savers strictly as a ‘rainy day’ fund and to otherwise keep your hands out of the cookie jar.
When selecting a new instant access saver in 2012, experts say you should research your options and select one that suits your needs. Many financial service providers will limit the number of yearly withdrawals on instant access savers, and nearly every best buy instant access account carry interest rates that are inflated by a bonus rate that expires after 12 months, which means you’ll have to move your cash to a new account at the end of 2012.
Some of these bonus rates, upon expiry, will leave an unsuspecting saver with a very low overall rate. This is because these bonus rates make up more than 50 per cent of the entire rate, leaving a former 3 per cent best buy with only 1 per cent – or less – in returns.
As far as your best buys for 2012, both Santander and ING Direct offer the highest interest rates at 3.1 per cent each. That rate is comprised of a 2.6 percentage point bonus in Santander’s case and a 2.56 per cent bonus for ING Direct.