Whether you are looking to boost your savings now that interest rates are higher, or just want a simple, reliable way to save over a fixed amount of time, a regular savings account could be a great option for you.

These accounts generally offer extremely competitive returns, but you must make sure you read the small print carefully, as there are often restrictions when it comes to how much you can pay in or withdraw. Here, we explain how regular savings accounts work, and where you can find the best rates currently available.

How does a regular savings account work?

Also known as monthly savings accounts, regular savings accounts are a type of savings account designed to encourage you to pay in a set amount every month, typically over a year.

Rachel Springall, finance expert at Moneyfacts.co.uk said: “Most of the top interest paying regular savings accounts available today are for existing customers or locals, available by post or by applying in branch, so savers would be wise to compare the terms carefully to see what is available to them.” 

The bank will tend to set a limit on the amount you can deposit each month, which usually ranges from £250 up to £350, and may set a minimum required deposit for each month as well (this can be as low as £1, but is generally from £10 up to £25).

Regular savings accounts usually come with attractive interest rates as they only run for a short period, meaning you should hopefully start to see decent returns as the term progresses. Once the term is finished, you can either take all the money from the account as a lump sum or it will be automatically transferred by your savings provider to a standard savings account, usually paying a much lower rate of interest.

Bear in mind that some banks won’t let you withdraw your money from your regular savings account before the end of the term. Some banks will also only let you apply for a regular savings account with them if you already hold a current account there.

What are the best regular savings accounts right now?

The different products offered by banks and building societies are changing all the time, and it can be hard to know where to start looking. To help you get started or keep up to date, we keep this list updated each week with five of the best regular savings accounts on the market.

Gatehouse Bank Regular Saver Account

AER: 7.00%

Minimum deposit per month: £1

Maximum deposit per month: £300

Access: None until maturity

Additional info: Interest is paid on the maturity of your account.

Apply: Gatehouse

First Direct Regular Saver account

AER: 7%

Minimum deposit per month: £25

Maximum deposit per month: £300

Access: No partial withdrawals or account closures within the 12 month account term. If a withdrawal is made, the interest paid will drop to 0.65%.

Additional info: The account is available to existing First Direct 1st Account customers online. New, non-First Direct customers will need to open a 1st Account before they are then able to open the Regular Saver.

Apply: First Direct

Nationwide Flex Regular Saver Issue 3

AER: 6.50%

Minimum deposit per month: £0

Maximum deposit per month: £200

Access: Three withdrawals per year, the fourth will see your rate drop to 2.15% AER/gross a year for the rest of the term.

Additional info: Only available to Nationwide current account holders. Interest is paid annually. After 12 months, your money will be moved into an instant access savings account with a lower rate of interest.

Apply: Nationwide

Lloyds Bank Club Lloyds Monthly Saver

AER: 6.25%

Minimum deposit per month: £25

Maximum deposit per month: £400

Access: Easy access

Additional info: After the first 12 months, the account reverts to the Standard Saver account. Customers must hold or open a Club Lloyds current account which requires a minimum monthly deposit of £1,500, if this condition is not met, a £3 fee will be paid for maintaining the account that month. The rate is fixed for 12 months and interest is paid on maturity.

Apply: Lloyds

Natwest Digital Regular Saver

AER: 6.17% on the first £1,000, 1.00% on amounts between £1,001 and £5,000 and 0.50% on amounts above £5,000.

Minimum deposit per month: £1

Maximum deposit per month: £150

Access: Easy access

Additional info: Customers must hold a NatWest current account to apply.

Apply: Natwest

What are the best members-only regular savings accounts?

These savings accounts offer some of the best rates on the market right now – but you can only access them if you are a pre-existing member with one of these building societies.

Skipton Building Society Member Regular Saver Issue 2

AER: 7.5%

Minimum deposit per month: £1

Maximum deposit per month: £250

Access: You can’t withdraw part of your account balance, however, you can close your account at any time and withdraw the full balance.

Additional info: You must be a Skipton Building Society member who joined on or before 31/05/2023.

Apply: Skipton Building Society

Coventry Building Society Loyalty Regular Saver

AER: 7%

Minimum deposit per month: £1

Maximum deposit per month: £250

Access: You can make withdrawals, but there is a charge equivalent to 30 calendar days interest on the amount withdrawn.

Additional info: You must have held or been linked to a savings or mortgage account with Coventry Building Society, ITL or Godiva continuously since 01/01/22 or earlier.

Apply: Coventry Building Society

Should I get a regular savings account?

The choice of whether to apply for a regular savings account depends on your financial situation and savings goals. Generally speaking, they are suitable for savers who don’t have a big lump sum to put away, but would like to get into the habit of saving a small amount on a regular basis.

As mentioned, some regular savings accounts will not let you withdraw your money during the term of the account. So, if you are trying to build an emergency fund that can be accessed quickly, you should make sure the account you are looking at allows withdrawals. Alternatively, you might be better off looking at alternative ways of saving, such as an easy access savings account.

As the highest rates on regular savings accounts tend to be on products with 12-month terms, you may also be better off looking elsewhere if you are interested in tying up your savings for longer. Our guide Fixed rate savings bonds explained shows the best fixed rate savings accounts currently available over a range of different terms.

Read about all the different kinds of savings accounts in our article What are the different types of savings accounts?

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