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As you near retirement age, it’s really important to give some serious thought to your finances.
Finding one of the best savings accounts for over 60s will make a huge difference. Not only do they offer high interest rates, but they’re also very reliable and easy to set up in the first place.
In this article, we’ve taken a look at the different types of savings accounts, the various options available on the market, how to choose the right one and the positive and negatives.
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Where over 60s are concerned, age is no barrier to opening a savings account.
Right now, the majority of people aged 60 and over have either a current bank account or a current building society account. While these are really useful for staying on top of day-to-day transactions and bills, they aren’t able to offer the best savings rates for over 60s. Some don’t pay out any interest, and when they do, it’ll usually only be for a few months or so.
More people in their 60s are now opening regular savings accounts with better interest rates for the first time.
The right savings account for you or your loved one depends on your circumstances, finances and saving goals.
Some savings accounts allow you to keep your money safe while steadily growing it. Others offer higher interest rates but are limited in terms of how and when you’re able to withdraw money.
If you’re aged 60 or over and would like to supplement your savings, the flexibility offered by a regular or easy access savings account may appeal. Meanwhile, if you’re still working and have plenty of disposable income, the higher interest rates offered by a notice or fixed rate savings account may be similarly tempting.
To make this search easier, we’ve explained each of the main types of savings accounts below.
If you’re looking to put away a certain amount each month and slowly build these savings up, a regular savings account could be the option for you! Usually, there will be a minimum and maximum amount you pay each month.
The money you pay in will earn interest over time. This interest rate often falls between 2% and 3%, but some providers will even offer 4% or 5%. Though as we mentioned, this interest rate may only be for the first 12 months, so it’s important to read the small print.
Some providers also require you to already have a current account with them to benefit from these higher interest rates.
Regular savings accounts for over 60s are perfect for achieving short-term financial goals, or if you’re saving with a specific date or event in mind.
Easy access savings accounts (also known as instant access savings accounts) are the simplest account type used by those over 60. Here, you can deposit and withdraw money without any restrictions or fuss. Some providers even offer bonuses if certain requirements are met.
This flexibility results in lower interest rates - these could be anywhere from 0.1% to 2%.
It’s important to be aware that some providers will limit the number of withdrawals you can make, while others will decrease interest rates if you pass a specific number of withdrawals. As is always the case, you should fully read the terms and conditions before agreeing.
We also have an article showcasing the best instant access savings accounts for over 50s.
A notice savings account requires a period of notice before you’re able to withdraw any money. Often, this period will be between 30 and 180 days. These are known as some of the best savings accounts for over 60s in terms of interest rates, with the incentive for the provider being that they’re able to keep hold of your money for a longer period.
The notice period will depend on what you agreed to when signing up.
Also known as a fixed-rate bond, a fixed rate savings account is a brilliant way of maximising your earning potential. If you’re able to put money away for a certain period, you’ll benefit from some of the most competitive interest rates.
Typically, this set period ranges from six months to five years. During this time, you won’t be able to access your savings without facing a penalty, so it’s important to ensure you’re able to afford not having access to this money for however long the length of time is.
Usually, longer-term deals (five years) pay better interest than shorter-term deals (six months).
If you’re preparing for retirement and are unlikely to need to withdraw money at short notice, a fixed rate savings account could be a great option.
Through a cash ISA, you won’t have to pay tax on the interest earnt through your savings - they’re completely tax-free. For the 2022/23 tax year, up to £20,000 can be placed into an account, including for those aged 60 and over. The same is true for the 2023/24 tax year - your ISA allowance will remain at £20,000.
Cash ISAs are easy to use, but do vary a little from account to account. Some offer unlimited withdrawals, while others have fixed rates with higher interest rates but not unlimited withdrawals.
We also have an article dedicated to the best cash ISA rates for over 60.
There are numerous savings accounts for over 60s to choose from.
Raisan offers a range of zero-fee savings accounts, and all of their banks are FSCS protected. Through their website, you can choose between easy access savings accounts, notice savings accounts and fixed rated savings accounts. You can also filter by the duration of the term you’d like, ranging from less than a year to a maximum of seven years.
You can use Nationwide Building Society to compare savings accounts and ISAs. To make your search easier, you can filter by how often you’d like to access your savings, and whether you’d like to view all savings accounts or just ISAs.
Each of the accounts they list includes:
Finder has a webpage dedicated to comparing savings accounts for over 60s. Their deals are updated daily and each of the accounts they showcase includes:
Here are some more savings accounts for you to consider:
We’ve summarised these different savings accounts available to you in the table below:
|Who Offers It? (Bank or Building Society)||Type or Name of Savings Account||Interest Rate|
|Aldermore||Double access||Up to 4.20%|
|First Direct||Regular saver||7.00%|
|Ford Money||Flexible saver||4.50%|
|Goldman Sachs||Online savings account||4.00%|
|Goldman Sachs||Cash ISA||4.00%|
|Investec||Online flexi saver||4.20%|
|Investec||90-day notice saver||4.75%|
|Leeds Building Society||Limited issue online access||4.40%|
|Nationwide Building Society||Start to save Issue 2||5.50%|
|Nationwide Building Society||1-year fixed rate ISA||5.50%|
|OakNorth Bank||Easy access||2.93%|
|RCI Bank||Freedom saver||4.20%|
|Santander||Fixed rate cash ISA||4.15% and 4.20% (depending on length)|
|Smart Save||Fixed rate||6.01%|
|Yorkshire Building Society||Rainy day account Issue 2||3.70% or 4.35%|
|Yorkshire Building Society||Internet saver ISA||3.75%|
|Zenith Bank||Fixed rate||6.00%|
Here are the biggest advantages of opening a savings account aged 60 or over:
|Advantage||How You’ll Benefit|
|High interest rates||The biggest selling point of a savings account for over 60s are the high interest rates you could potentially earn. Often, these accounts are at least 0.5% higher than other types of accounts.|
|Reliable and consistent rates||These types of accounts tend to be fairly stable in terms of their interest rates, so you’re much less likely to be affected by an unstable market. This makes over 60s savings accounts much lower risk.|
|Money is guaranteed up to £85,000||In the UK, the government guarantees all savings within a banking group up to £85,000.|
|Monthly interest||Many savings accounts offer a convenient option to pay out interest on a monthly basis, rather than once a year. Doing this makes budgeting and planning much easier.|
|You can open multiple accounts||If you wish, you can have multiple accounts across multiple banks. The benefit of doing this is that you aren’t limited to a certain amount (whereas you would with other types of accounts). This makes it easier to take advantage of higher interest rates.|
|It’s a good habit to be in||We’d definitely recommend getting into the practice of regularly saving money. If you or a loved one has a limited income in later life, having an over 60s saving account encourages a healthy financial lifestyle.|
|More convenient than ever before||Thanks to internet banking, it’s easier than ever before to quickly manage your finances. There are lots of guides dedicated to online banking for older adults.|
Whilst savings accounts offer lots of benefits, there are a few drawbacks as well:
|Disadvantage||Why Could This Be An Issue?|
|Lower interest rates than advertised||While the impressive rates are definitely a positive, it’s important to be aware that you won’t earn it on a lump sum. Rather, you only get interest on what you’ve saved.|
|Lack of choice||Many banks and building societies don’t offer over 60s accounts, so choice can be limited.|
|Minimum monthly deposits||If you don’t save regularly, you might not receive the advertised interest rate. To take full advantage of a savings account, you need to save a certain amount every month.|
|Short interest rate period||While a high interest rate is advertised, this rate will often only last for the first 12 months, before changing to a lower interest rate. This results in many people moving their money from account to account every year or so.|
|Potential penalty costs for withdrawals||Depending on the type of account you have, you may have to pay a penalty to access your money early. You may also be restricted in the number of withdrawals you’re able to make.|
We’re on a mission to support individuals and their loved ones throughout each stage of their later living journey. For more information, check out everything Lottie has to offer.
Savings accounts for over 60s work the same as those for people of other ages. So no, there isn’t one specifically for over 60s. However, some savings accounts are definitely more suitable for over 60s than others.
Yes, money that goes into a savings account is kept safe. Any authorised money that goes into a UK bank or building society account is protected by the Financial Services Compensation Scheme. Through this scheme, money up to £85,000 is protected.
Written by our team of experts and designed to help families fund later life care in England.