Best bank accounts

A comparison of the best current accounts for savers

Customers of high street banks can earn up to 2% credit interest on their current accounts, which is more than the interest rate offered by the majority of savings accounts, and it only takes a few minutes to open a bank account online.

Our first table compares several offers for credit balances of one thousand pounds (you may learn how to become eligible for interest on the accounts by clicking the “more info” button). The leading bank switching offers are detailed in the second table.

Read our in-depth, step-by-step guide on opening numerous high-interest bank accounts if you want to maximise your returns on investment.

Virgin Money M Plus 2.02% on a thousand pounds.

After Clydesdale Bank and Yorkshire Bank were acquired by Virgin Money for a total of £1.7 billion in 2018, their digital banking service, which was formerly referred to simply as “B,” was renamed the Virgin Money Current Account.

You can apply for a linked savings account that pays 0.35% AER and receives the top rate of 2.02% AER (2% gross) if you have a balance of up to £1,000 in your Virgin Money account, which pays the top rate of 2.02% AER.

When you pay with your debit card or withdraw cash from an ATM overseas, you won’t be subject to any international transaction fees. Considering that some banks charge as much as 3.75% for cash withdrawals and purchases, this represents a significant savings for frequent fliers.

Virgin Money, in contrast to the majority of other providers, does not force you to pay in a specific amount every month in order to earn interest, nor does it mandate that you keep a certain number of direct debits active at all times.

2% APR variable for a year on loans of up to 1,500 with Nationwide FlexDirect

The initial annual percentage yield (AER) on balances up to $1,500 paid on the Nationwide FlexDirect account is 2%. This rate is fixed for the first year. After that, the rate will revert to an AER of 0.25% and apply to balances of up to £1,500.

If you open a FlexDirect account, for the first year you won’t be charged any interest on any scheduled overdrafts, but beyond that point you’ll be subject to a rate of 39.9% annual percentage rate (APR).

You won’t be charged any fees to use your debit card to make purchases while you’re travelling, but withdrawing cash from an ATM will cost you 2.99% of your withdrawal amount.

Increasing savings through the use of numerous current accounts with high interest rates

The low rates of interest offered by savings accounts have led many people to switch their money into current accounts with higher rates of interest in order to get the most out of their money.

The disadvantage of having this kind of account is that banks put restrictions on it, such as requiring a certain minimum amount to be paid each month.

However, we will show how you can circumvent these restrictions and make the most of your financial resources while still adhering to the laws that have been established.

How to get the most out of high-interest checking and savings accounts

Step one is to locate the highest interest rates offered by current accounts.

The information that you’re looking for regarding current account interest rates can be found in the table that’s been provided for you above, along with the maximum number of accounts that can be opened.

Step 2: Confirm that you meet the criteria for the high-interest account

To be eligible for interest on an account or to prevent having to pay a monthly charge for maintaining the account, banks may frequently impose certain account restrictions, such as fees, minimum monthly deposits, and direct debits.

There is a cap on the amount of interest you may earn from each account; however, most financial institutions will let you open a second main account or a joint account, which effectively doubles the amount you can make from your money.

Be wary of accounts that offer tiered interest, which means that you get a higher rate for having a higher amount. However, in order to earn the highest rate of interest, you need to have a balance that falls inside the top tier of the account. These accounts are less competitive as you move down through the tiers.

Step 3: Get paid immediately for making the switch

There is a less complicated technique to put money aside for the future before you start moving savings around.

To bring in new customers, financial institutions frequently give cash bonuses of up to one hundred pounds, and the process of switching banks should take no more than seven days of regular business hours.

Keep an eye out for requirements, such as making a deposit of a predetermined sum or utilising the online banking services by a predetermined date.

Open a number of high-interest checking accounts as the fourth step.

The amount of money that you wish to put away in savings will determine the number of accounts that you will need to set up.

This is due to the fact that interest will only be accrued on account balances up to a specified threshold (for more information, see the notes on the table above). You need to make sure that there is no money that is “extra” and languishing in accounts where it is not paying interest.

Proceed to Step 5 to transfer funds between your several high-interest current accounts.

Additionally, the majority of financial institutions demand that you deposit a predetermined sum into your account on a monthly basis.

Take out of your savings an amount that is equivalent to the account with the greatest required minimum deposit. Therefore, if you have three accounts, one with a minimum of $500, one with a minimum of $1,000, and one with a minimum of $1,500, set aside $1,500.

This cash will be transferred back and forth between these accounts on a continuous basis.

Step 6: Place the remainder of your savings in the accounts designated for them.

Proceed by moving the remainder of your money from the account with the lowest earnings to the one with the highest earnings.

After you have placed the maximum amount that will earn interest on the account, you should then put money into the account that pays the next greatest interest, and so on.

Step 7: Perform step 5 once more every month

Setting up standing orders, which are instructions given to your bank to pay a specified amount to another account at regular intervals, is the simplest way to accomplish this goal. When standing orders are in place, the funds are automatically transferred from one account to another on a monthly basis.

This indicates that you have satisfied the requirements of each account and are earning the maximum amount of interest possible on the total amount.