Notice accounts offer middle ground for savers who want something in between easy-access accounts and fixed-rate savings bonds
If you do not want to lock your savings away and want quick access to your money an easy-access account is normally the best option.
However, if you are looking to gain some interest on your savings and still have some flexibility you might want to consider a notice account.
These allow you to dip into your savings as long as you inform your bank in advance. You can earn a higher rate than with an easy-access account, but not quite as high as with a fixed-rate savings bond.
Typically, you will have to give advance notice of 30 to 90 days to your bank or building society before you take your cash out.
Some accounts are even more restrictive and may require notice of up to 180 days.
Notice accounts are good for savers who would like to make an occasional big purchase, but still want the benefit of receiving interest. For example, they are useful if you are saving up to buy a car or a holiday later in the year.
However, if you are saving money for a rainy day and want to draw the money out quickly, a notice account may be too restrictive for you.
If you are looking to use the account regularly, it won’t be of much use as you will lose your interest.
The highest paying notice account is from the Bank of London and the Middle East at 1.71%. It comes with a 90-day notice period and can be opened online.
However, it requires £10,000 to open the account so might be out of reach for most savers. This account offers an ‘expected profit rate’ (EPR) instead of traditional interest.
The Moneybox 95 Day Notice account offers a rate of 1.65% and can be opened on your smartphone with a deposit of £1. Just behind at 1.6% is ICICI Bank’s 95-day notice account, which can be opened through the online Raisin savings tool with a deposit of £1,000.
If you are looking for a shorter notice period, the Secure Trust Bank 60 Notice Account has a rate of 1.5%. You will need £5,000 to open the account.
These accounts offer higher rates than the best easy-access account from Gatehouse Bank at 1.41%. It can be opened online with a deposit of £1,000 and there are no limits on the number of withdrawals you can make. This account also offers and EPR rate.
Notice accounts with the shortest notice periods tend to pay the lowest rates.
OakNorth Bank’s 35 Day Notice Deposit account has a rate of 1.2% while Aldermore’s 30-day notice account pays 1.3%. Both accounts can be opened online.
Cash Isa notice accounts
Notice Cash Isas give you greater flexibility over ordinary fixed Isas.
However, savers are increasingly finding their options for notice Cash Isas limited, while rates are also lagging behind their easy-access counterparts.
The Moneywise Best Buy is the Aldermore 30 Day Notice Cash Isa, which pays 1.3% to customers who give 30 days’ notice.
The account can be opened online with a deposit of £1,000. If you deposited £5,000, over a year you would earn £65 in interest.
The top-rated easy-access Isa is from Al Rayan at 1.36%. You can open this account with a deposit of £50.
If you deposited £5,000 in this account, you would earn £68 in interest over a year.
Moneybox 95 Day Notice Account
This account pays 1.65% interest and can be opened online. It has a 95-day notice period and requires a £1 initial investment.