Savings FAQs
Some links on this page are referral links. If you use them, we may earn a commission at no extra cost to you. This never affects how we rate products. How we make money
Important: This guide provides general information, not personalised financial advice. Financial products, rates and eligibility rules can change, so check the provider’s current terms before applying. Some links are referral links — we may earn a commission. You can check a firm’s details on the FCA Register.
FSCS protects eligible deposits up to £120,000 per person, per authorised institution.
Quick answer
Short answers to the savings questions we’re asked most: how rates work, how interest is taxed, how much is protected and how to choose between easy-access, notice and fixed-rate accounts.
Who it’s for
- Anyone opening or reviewing a savings account
- First-time savers learning the jargon
Who should skip it
These are general points to weigh up, not advice. You may want to look elsewhere if:
- You need personal tax advice — speak to HMRC or a qualified adviser
The catch
Rates change often and headline figures can include temporary bonuses. Always check the rate you’ll actually earn, how long it lasts and any withdrawal limits.
Full explanation
Savings accounts come in three main types: easy access, notice and fixed rate. The trade-off is always between access and rate. Our easy-access or fixed-rate guide helps you decide which suits each pot of money.
Figures set by the government or a regulator were correct as of 3 October 2026. Check the official source before relying on them.
FAQs
What does AER mean?
AER stands for Annual Equivalent Rate. It shows what you’d earn over a year if interest were paid and compounded once a year, so you can compare accounts fairly. See AER explained.
What is an easy-access savings account?
An account you can pay into and withdraw from when you like, usually with a variable rate. It’s also called an instant-access account.
What is a fixed-rate savings account?
An account that pays a guaranteed rate for a set term, usually without access until the end. See fixed-rate savings accounts.
What is a notice savings account?
An account where you give notice, such as 30 or 95 days, before withdrawing money.
Is savings interest taxed?
Interest outside an ISA counts towards your Personal Savings Allowance: £1,000 for basic-rate, £500 for higher-rate and nothing for additional-rate taxpayers. Interest above that is taxed.
How much of my savings is protected?
Eligible deposits are protected by the FSCS up to £120,000 per person, per authorised bank or building society.
Can my savings rate change?
Variable rates can change, usually with notice. Fixed rates stay the same for the term.
How much should I keep in easy-access savings?
A common rule of thumb is three to six months of essential spending, but the right amount depends on your circumstances.
Should I use a cash ISA instead?
It depends on whether your interest is likely to exceed your Personal Savings Allowance. See ISA vs savings account.
Compare savings accounts or model how savings could grow.
Some links in this table are referral links. We may earn a commission if you use them, at no extra cost to you. Rankings are based on our review methodology, not commission.
Get our weekly email
The Friday Finance Lowdown — five minutes of the money stuff worth knowing.
Free to join. See our privacy policy for how we handle your email address.