If you’re like many people in the UK, your savings might be sitting in an account that’s barely earning any interest. But there’s good news: with just a few clicks, you could earn an extra £200 or more a year—without doing anything risky or complicated.
Thanks to rising interest rates and new banking options, finance experts say now is the perfect time to switch to a better savings account and start making your money work harder.
How Much Are You Losing in Low-Interest Accounts?
A surprising number of people still keep their money in accounts offering 1.5% interest or less. This means you’re essentially leaving free money on the table. Research from Yorkshire Building Society reveals that the average person with around £6,700 in an ISA could be missing out on at least £200 every year just by using a low-return savings product.
Compare that to accounts currently offering 5% interest or more, and the potential gain becomes clear.
See the Difference: Low vs. High Interest
| Amount Saved | Interest Rate | Annual Interest Earned |
|---|---|---|
| £5,000 | 1.5% | £75 |
| £5,000 | 5.0% | £250 |
| £6,700 | 1.5% | £100.50 |
| £6,700 | 5.0% | £335 |
Switching accounts could boost your returns by hundreds of pounds each year—with no extra effort.
What Accounts Should You Look For?
There are now plenty of high-interest savings options available through both traditional banks and building societies, including:
- Fixed-Term Savings Accounts – Lock in your money for 1–5 years for the best rates.
- Regular Saver Accounts – Ideal if you want to save monthly; some offer rates above 6%.
- High-Interest Cash ISAs – Keep your savings tax-free while enjoying better returns.
Many of these accounts can be opened online in minutes, and transferring your savings is often quick and hassle-free.
Why People Miss Out — and How to Fix It
According to Harry Walker, senior savings manager at Yorkshire Building Society, many people simply don’t review their savings regularly enough.
“It’s surprising to see such a large amount still sitting in low-paying ISA accounts, especially after savings rates have gone up in the last two years,” he says.
He notes that now is the perfect time, particularly with the new financial year underway, to review your savings strategy and switch if needed.
Safety First: Is My Money Protected?
Yes — savings accounts in the UK are protected by the Financial Services Compensation Scheme (FSCS). This covers up to £85,000 per person, per institution, meaning your money is safe even if your bank fails.
You can also transfer your ISA to another provider offering better interest rates—just make sure to use the official ISA transfer process to keep the tax-free status intact.
3 Reasons to Switch Your Savings Account Today
- Earn More Without Extra Work – No investing, no risk. Just better returns.
- Beat Inflation – Higher rates help your savings keep up with rising prices.
- Reach Financial Goals Faster – More interest = faster savings growth.
FAQs
How can I find the best savings account?
Use comparison websites or visit bank/building society sites directly. Look for high-interest accounts with low fees and good flexibility.
Is it safe to move my savings?
Yes. As long as your bank is FSCS-protected, your savings (up to £85,000) are secure.
How quickly can I switch?
Most accounts can be opened online in 5–10 minutes. Transferring your savings may take a few business days.
Can I transfer my current ISA?
Yes. You can switch to another provider offering better rates, but use the official transfer process to keep the ISA’s tax-free status.
