Savings rates are rising! You can earn 0.72% on easy access savings (if you’re quick)!

Family Building Society has launched a table-topping easy access savings account. Here’s why savers must act fast to get it.

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It’s the news savers have been waiting for: savings rates are on the up!

This week has seen the launch of a new table-topping easy access account paying 0.72% AER variable. But if you want it, you’ll have to act fast as it won’t be available for long. Here’s everything you need to know.

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How can you earn 0.72% on easy access savings?

If you’re looking for the highest easy access savings rate, then take note of Family Building Society’s new Premier Saver account. It currently pays 0.72% AER variable, which is the highest easy access rate we’ve seen for a while.

You can save from £1,000 to £250,000, and you must open the account online. As it’s easy access, you can make as many withdrawals as you like, though you must take out a least £100 each time. 

Interest is calculated daily and paid every year on 31 January. While the account currently pays the highest easy access rate, the interest rate is variable, so it could change at any time. If the rate does go down, you’ll be notified in advance, giving you enough time to move your cash to another savings account if you wish.

Why must savers act quickly to access the 0.72% rate?

It’s worth knowing that there is an odd quirk with this account, meaning you must act quickly if you want to secure the 0.72% AER variable interest rate. That’s because the account stipulates that you can only add funds to it until 3pm on Monday 7 February. After this ‘funding cut off date’ you’ll still be able to withdraw cash, but you won’t be able to add further funds to the account.

As a result, if you’ve a hefty lump sum to save, you’ll have to stash all of it into the account ahead of the deadline.

What easy access alternatives are available?

Because the Family Building Society account has a funding cut-off date, it won’t be to everyone’s taste. 

Therefore, if you’d prefer a more straightforward account, then you may wish to look at Shawbrook Bank’s easy access account that pays a slightly lower 0.67% AER variable. This account allows you to deposit between £1,000 and £85,000, and you can make as many withdrawals and deposits as you like.  

Alternatively, if you have less than £1,000 to save, then the Marcus online savings account is an easy access account that pays 0.6% AER variable. This rate includes a 0.1% AER fixed bonus for 12 months. With Marcus you can save from as little as £1 (up to £250,000), and add or withdraw funds at will.

All of these easy access accounts have full FSCS savings safety protection, up to the £85,000 limit. This means that if any of these providers go bust, your money is safe up to the limit. (Do note that Marcus shares its FSCS protection with Saga, so don’t save more than £85,000 across these two providers).

For a full list of easy access options, see our top-rated easy access savings accounts.

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Will other savings rates increase?

It’s certainly plausible that Family Building Society’s latest offering may encourage other providers to up their rates. A more competitive savings market is great news for savers as it means higher interest rates.

As the Bank of England base rate is tipped to rise again in 2022, this is also likely have an impact on the savings market. That’s because a higher base rate makes borrowing more expensive for lenders, which makes savers’ cash more attractive. In other words, a higher base rate should lead to higher savings rates across the board. However, it remains to be seen whether this will prove to be the case.

How can I boost the interest rate on my cash?

While 0.72% AER variable is the highest easy access savings rate we’ve seen for a while, if you’re keen to earn an even bigger rate then you may wish to explore the option of locking away your cash.

That’s because right now, you can earn 1.36% AER fixed for one year with Zopa. If you’re happy to lock away cash for longer, then you can earn 1.62% AER fixed for two years through Charter Savings Bank

If you don’t need access to your cash for a very long time, then Charter Savings Bank offers an account paying 2.1% AER fixed for five years.

For more fixed options, see the list of our top-rated fixed-rate bonds.

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