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Regular Savings Accounts
Earn up to 3% on your savings
Updated Monthly
Regular savers were hit hard last year, with cuts to 5% rates across the board. But it's still just about possible to earn 3% interest on savings tax-free. Regular savings accounts are a hidden species designed for you to feed them every month – we've all the best buys in this guide, plus tricks to maximise interest.
Other top MSE savings guides...
Top Savings Accounts: Best easy-access and fixed-rate deals
Top Cash ISAs: Save in a permanently tax-free account
Automatic app savings: Clever apps that save for you
What are regular savings accounts?
The clue's in the name. Most regular savings accounts require you to put money away each month with interest paid yearly (unless otherwise stated). They offer higher interest rates than traditional fixed or easy-access savings accounts, but tend to impose rigid terms and conditions, such as limiting the number of withdrawals you can make, or forcing you to make a deposit every month. And the rate usually only lasts for a year.
Rather watch than read? This little video gives you the regular savings lowdown...
Embedded YouTube Video
Eight regular savings need-to-knows
To help you make the most of a regular savings account, it's worth getting your head around the following need-to-knows...
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While regular savings accounts can pay higher rates of interest, the problem with them is that it takes time to build up the amount of money you have in there. Yet if you have a lump sum of cash, and you want to maximise its earnings, you can still take advantage.
Put the lump sum in the top-paying easy-access account
You'll then start earning interest on the full sum straightaway (see Top Savings Accounts).
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Pay the money into the regular saver from the easy-access account
Now make payments into the regular saver straight from your easy-access account each month. The key is to put as much as you can (up to the monthly limit) into the regular savings account to max the interest.
This technique is called 'drip-feeding', as you're slowly moving your cash across, month by month. This means every penny you want to save is earning the most it can possibly do at any one moment. Here's how it should work in practice.
Let's say you have £3,000 in savings. If you start by putting this in a top easy-access account and moving £250 across to a top regular saver in the first month, you'll have £2,750 earning the easy-access rate (eg, 0.6%), and £250 earning the higher regular saver rate (eg, 1.35%).
This way, you can keep getting interest on the lump sum while getting a higher rate on the money you pay into the regular saver. After 12 monthly payments, the full amount will be in the regular saver. You can then move the whole lot to the top payer at the time and start the process again with a new regular saver (provided they're still around).
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The protection you get here is the same as normal savings. Provided your money is in a UK-regulated bank or building society account, it's protected under the Financial Services Compensation Scheme (FSCS). The golden rule is...
The first £85,000 per person, per financial institution is protected.
While that sounds simple, the details are more complex – there are specific rules involving how different banks are registered and what counts as a financial institution. For full info, read the full Are My Savings Safe? guide.
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How to maximise safety
With most regular savers, limits on the amount you can deposit mean the balance gets nowhere near £85,000, so there's no problem.
But if you have savings in other accounts with the same bank, don't put more than £85,000 in any one institution – spread it around. See how to get 100% safety.
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Top bank-linked accounts
The top-paying regular savers come with a big 'but' attached – you must also hold or switch to the same bank's current account. We've listed key info in the table below.
Bank-linked regular savers – what we'd go for
If you have a NatWest or RBS current account, you can get the top rate of 3.04% with their linked regular savers. Yet these accounts only let you save a maximum of £50 a month, and the rates are variable – so the returns aren't certain.
Alternatively, if you've a Club Lloyds account, you can get 1.5% fixed for a year on up to £400 a month.
Sadly, other bank linked accounts paying similar amounts have dropped their rates recently, leaving these three as the only ones paying more than the open-to-all accounts below.
| Bank | Rate (AER) | Min/max monthly deposit | Can you skip months? | Withdrawals allowed? |
| NatWest | 3.04% variable |
£1/£50 | ✓ | ✓ |
| RBS | 3.04% variable |
£1/£50 | ✓ | ✓ |
| Lloyds (Club Lloyds custs) |
1.5% fixed for 1yr (1) |
£25/£400 | ✓ | ✓ |
(1) 1% on up to £250/mth for other Lloyds custs.
Quick questions
Top open-to-all accounts
If you don't have the current account necessary to unlock one of the accounts above, check out the top open-to-all accounts below, that aren't linked to other products.
Sadly recent rate drops mean that these open-to-all accounts aren't as lucrative as the top bank-linked accounts. While there are still decent deals on offer, they can be beaten by branch-based accounts offered by local building societies. So check if there's a decent account near you.
Regular savers open to all – what we'd go for
Here, the top rate is from Coventry BS, which pays 1.3% and lets you save a decent £500/mth. However, if you want to make withdrawals you'll face a 30 day interest penalty, and the rate's variable – so you'll need to keep an eye on it in case it drops.
Alternatively, if you want some added certainty, Principality BS pays 1.25% fixed for a year on up to £250/mth.
Whichever account you pick, it's worth diarising to move your cash after a year when the term ends – otherwise your money will be moved to a standard account paying much less.
| Provider | Rate (AER) | Min/max monthly deposit | Can you skip months? | Withdrawals allowed? | How to open |
| Coventry BS | 1.3% variable |
£1/£500 | ✓ | ✓ (30 day interest penalty) |
Online/ phone/ post |
|---|---|---|---|---|---|
| Principality BS | 1.25% fixed for 1yr | £1/£250 (1) | ✓ | ❌ (2) | Online/ post/ branch |
| Dudley BS | 1.25% variable | £1/£250 (3) | ✓ | ❌ (2) | Post/branch |
(1) Min £20 deposit to open. (2) Can access early by closing account without penalty. (3) Min £100 deposit to open.
Top branch-based regular savers
Local and regional banks and building societies often offer good rates, though usually accounts need to be opened in branch. We've listed the top account that pays more than the 'open-to-all' rates above. See if there's a branch near you.
West Midlands
West Bromwich Building Society's regular saver pays 2% AER fixed for 12 months and you can save £10-£100 a month. It has 20+ branches in the West Midlands (find your nearest).
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The Regular Savings Calculator
Below is a special calculator designed to help you work out what you'll earn from regular savings. It assumes your savings are covered by the relevant personal savings allowance for your tax rate.
The calculator has two options...
Regular savings only. Choose this if you want to know how much you'll get from a regular saver alone.
Drip-feed calculator. If you want to save a lump sum, and are using the drip-feed route above, this will tell you how much you get, and compare it with keeping the money in a normal savings account.
For the most accurate answer, use the AER (Annual Equivalent Rate) which should be listed on your statement. Remember, most normal savings accounts are variable rates, so the drip-feed calculation will change if the rate does – but it's a good indicator of the returns.
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