Best instant access savings accounts for the over 50s

Are you aged over 50 and looking for an easy access account for your savings? Our guide examines how you can choose the best option.

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What are instant access savings accounts for the over 50s?

Instant access savings accounts are bank accounts where you can put money aside but still have easy access to it. This means you can add and withdraw funds at will, without facing any penalties or being obligated to keep money in the account for a set period of time, like with a fixed term savings account.

Instant access savings accounts can usually be opened with as little as £1, and typically attract higher interest rates than current accounts. But they don’t come with any sophisticated features or digital tools, as they are designed for saving not spending.

As the name suggests, instant access savings accounts for the over 50s are available exclusively to banking customers aged from 50 upwards. There isn’t a wide range of providers who offer these products, but one example would be Saga.

Are instant access savings accounts for the over 50s worth it?

The crucial point to consider here is the interest rate that comes with the savings account.

Instant access savings accounts for the over 50s may be an exclusive product designed for a particular age group, but that doesn’t mean they have the best interest rates out of the whole market.

Over 50s can still open the same instant access accounts as other savers in the wider market, so it’s important to explore your options before you decide which savings account to go for.

How to choose the best instant access savings account for the over 50s

The key here is to research both instant access savings accounts that are available to the over 50s, and those that are available to savers in any age group. You can then compare them and select the one with the best interest rate or the overall offering that is most suited to your needs.

Here are some factors to think about when choosing your account:

  • Account management. Although you technically have instant access to your money, how easy is it to open and manage the account? Check whether it can be done online, or if you have to visit a branch or do it by telephone banking.
  • Interest rate. This is the most important feature of a savings account if you’re hoping that the money you’ve set aside will also generate a return. Although bear in mind that instant access savings accounts tend to offer lower interest rates than more “conditions-attached” savings accounts, such as fixed term or notice accounts.
  • Bonuses. Some accounts have introductory offers included in their interest rates. So even though you have instant access to your savings, be mindful about how long you’ll you need to keep a certain amount of money in the account in order to qualify for any available bonus.
  • Minimum balance. The minimum balance required to open an instant access savings account is usually pretty low (as little as £1, compared to around £500 for a fixed term account). But this minimum amount could increase if there’s a higher interest rate on offer. Make sure you have the money available to deposit and to maintain a certain balance, if that’s a condition of a higher interest rate or bonus.
  • FSCS protection. Does your savings account provider offer security for your money? Only financial institutions with a UK banking licence offer protection up to the value of £85,000 under the Financial Services Compensation Scheme. (Although other financial providers will have safeguards in place in order to be allowed to operate in the UK, just not the FSCS specifically.)

Pros and cons of instant access savings accounts for the over 50s

Pros

  • Higher interest rates than current accounts
  • Easy access to your funds if you need to withdraw them
  • No penalties for withdrawals and no fixed term saving period
  • Can be opened with a low minimum deposit

Cons

  • Lower interest rates than other savings options, such as fixed term accounts
  • Tax payable on any interest income that exceeds your personal savings allowance (which is £1,000 for basic-rate taxpayers and £500 for higher-rate taxpayers)

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.

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