While the Bank of England Base Rate remains at a 15-year high of four percent, some banks and building societies have been reflecting the higher interest rate in their own savings products. Nationwide is currently offering regular savers an Annual Equivalent Rate (AER) of five percent. But what’s more, savers also get the opportunity to be entered into a £250 prize draw.
Regular savings accounts work well for people looking to start building up a savings pot, as these accounts typically offer some of the highest interest rates on the market and the terms generally encourage savers to pay money into the accounts monthly with limited withdrawals.
Nationwide BS’ Start to Save (Issue 2) is also offering the benefit of an additional reward to be snapped up through three prize draws.
Savers can open the account with a minimum deposit of £25 and up to £50 can be invested each month.
Interest is calculated daily and paid annually on the anniversary of opening but the rate is variable, which means it can go up or down depending on the terms.
Start to Save (Issue 2) is an online account and savers must be 16 or over to open it. It is also an instant access savings account, which means withdrawals are permitted whenever needed. However, this will have an impact on the qualifying for the prize draw.
To be entered, savers will need to increase their account balance by at least £25 (but by no more than £50) in each of the six calendar months leading up to the month of the prize draw.
The first prize draw took place on February 21, 2023, and the upcoming two will fall on August 22, 2023, and February 20, 2024.
Winners are selected at random from all accounts that qualify for the prize draw and each winner will receive £250. According to Nationwide BS, the chance of winning is between 1 in 34 and 1 in 67, depending on how big the prize fund is.
But while Nationwide might be offering an attractive deal, it isn’t currently the highest rate available for regular savings accounts.
According to the moneyfactscompare.co.uk ‘Best Buys’ list, first direct’s Regular Saver Account with an AER of seven percent on up to £3,600 per year, places top.
There are no minimum opening deposits required and savers are being afforded the AER of 6.17 percent on savings up to £5,000.
Once the accounts hit £5,000, a 0.65 percent rate will be applied to the rest.
There is no minimum deposit required to open the account and it allows people to save up to £150 each month by standing order. Unlimited withdrawals are permitted without penalty and interest is awarded monthly.