Recently, there has been a spate of adverts from many high street banks proclaiming how high their savings rates are. But are these high savings accounts really worth it? The answer is, it depends.

A string of banks have recently advertised their regular savings accounts with fantastic savings rates, however these deals are not always as great as they may seem and it is critical to read the small print associated with the deal before deciding to open up an account.

Firstly, many of the accounts are tied in to another linked product such as a current account. The downside here is that the current account will normally pay a really poor rate of interest, or you have to pay for the current account.

Another catch may be that you are limited by the number of withdrawals you can make from your new savings account and if you go over the designated transactions permitted, you will lose the high rate of interest in favour of a really poor rate. If your account has this clause, make sure you are happy to not touch the money for whatever the length of the terms of the account are. Some accounts will also penalise you with the drop in rates if you fail to make the regular payment each month into the savings account – it is normally best to set up a standing order to the account to make sure you meet the deposit criteria.

It is also worth noting that savings accounts will be taxed therefore it may be better to fill your year’s ISA quota before placing any money into a savings account as the ISA money is not taxed.

Despite these negatives, if you are strict with yourself and the way you run the account, they are definitely worth considering. It is important to make sure that you adhere to the terms of the account strictly to ensure you get the higher rate of interest, and if the product is linked to another product (such as a premium current account that you might have to pay for), that the savings rate received is worth it when offset against the amount you are paying for the linked product.

As there are no restrictions on the amount of regular savings products a single person can take out, if you have the cash to spare, it may be worth taking out more than one regular saver account to maximise the interest on your savings. However, as with any financial product, it is important to read and understand the small print to make sure that you really do make the most of your money.

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