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www.InvestmentGuide.co.uk Other Bank and Building Society Accounts
BANK and BUILDING SOCIETY
(Also known as On-Line Deposit e-saver, e-savings, Net Savings, Internet Savings)
An account which pays a good interest rate and where you
can withdraw immediately, generally without notice or penalty but only on-line.
Deposits generally have to be made by direct debit from (usually up to three)
nominated current accounts at other banks or through an on-line current account
at the same bank.
The rates on these accounts may be excellent when
you invest but they often don't stay that way. Some of the best accounts
include an "introductory bonus" which usually lasts for up to 6 months. It is
unlikely that your account will continue to pay a top rate, so you will need to
switch to another account which does. For operating a current account on-line,
see Bank and Building Society On-Line Banking.
Who can invest Anyone.
How worthwhile Good value for readily available money. The companies may expect you to memorise two or three un-memorable passwords and some don't allow you to choose your own or if they do, restrict them in a way which make them difficult to remember, e.g. 6 digits, only numbers. You may want to consider instead Bank and Buildings Society Postal or Phone Account. See also Offshore Bank Instant Access Account.
Minimum £1, £1,000 or £2,000.
Maximum Check with the company. Maximum may vary from £50,000 per person to £1 million. Some are open for deposits from new customers for limited periods only.
Suitable Lump sums.
Money back Usually three working days. You transfer the money on-line to another bank account and it is usually available for use on the fourth working day after your transaction. All banks have a cut-off time each day; transactions made after this time count as being made a day later; this cut off time varies from 11.30 am to 5.30 pm depending on the bank or building society. Some accounts also have cash cards, see also Bank and Building Society Cash Card Account.
Interest Variable. More interest sometimes paid for larger amounts, e.g. when over £10,000. There may be a limited bonus rate for the first period of up to 6 months.
Interest paid Usually yearly. Direct to a bank account, or left to accumulate. Some also pay monthly but at a lower nominal interest rate, see also Bank and Building Society Monthly Income Account.
Tax 20% tax is deducted from the interest. Non-taxpayers can reclaim the tax from the Inland Revenue (or have interest paid with no deduction). Higher rate taxpayers have to pay extra tax; basic rate taxpayers don't.
Fees to pay Usually none.
Passbook Statement usually sent with each transaction or yearly.
Children Unsuitable.
Risk 100% compensation scheme on the first £35,000 since 1 October 2007 for each investor in each UK licensed bank or building society under the investors compensation scheme. There is a theoretical risk that if you are not careful to conceal your password, money can be stolen from your account as no signature is required for transactions. Check the bank's conditions of use to see what your liability might be.
How to invest Go to the web site of one of companies listed below and sign on on-line.
Where from Best rates at : Click here for the best rates.
Other Bank and Building Society Accounts
Last updated 15
December 2007.