Notice accounts

Interest rates up to 0.80% AER at Raisin UK

• Earn a competitive variable rate of interest on your savings
• Enjoy the flexibility to withdraw your money after a set notice period
• Ideal for short or medium-term savings goals, with no fees on our marketplace

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The rundown
  • A notice account requires you to give your bank notice before making a withdrawal, typically between 30 to 180 days
  • Open with a lump sum deposit
  • Earn a variable rate of interest on your savings

What are notice accounts?

A notice account is a type of savings account that requires you to provide notice to withdraw your savings. The notice period is typically between 30 and 90 days, but with some notice accounts, you’ll need to provide as much as 180 days’ notice before you can make a withdrawal.

Notice accounts feature a mix of the benefits of other savings accounts, including rates comparable to fixed rate bonds, coupled with similar levels of flexibility of an easy access savings account.

January notice accounts update: what’s new?

Notice accounts could be the way to kickstart your 2022 financial year. There’s no time like the present to get ahead in the finance game. Notice accounts offer attractive returns on your savings when you adhere to the correct notice periods set for your account. 

With new year rates coming at around 0.80% AER at Raisin for a 32 day notice period, a notice account could be a good way to up your returns, while keeping control of your finances. 

Want to stay up-to-date with the latest offers and news on savings and notice accounts each month?

How do notice accounts work?

Notice accounts require you to ‘notify’ your account provider in advance every time you want to withdraw cash. The length of notice differs between accounts, with longer notice periods often earning higher rates of interest due to the longer wait between providing notice and getting your cash. 

The shortest notice period is typically around 30 days, with longer periods requiring 120 days. Some providers also restrict the number of withdrawals you can make in one year. 

If you need urgent access to your cash within your notice period, you’ll usually have to pay a penalty. 

How long is the notice period?

You can choose from various notice periods, giving you the flexibility of a shorter or longer notice period to suit your needs. Notice periods typically range between seven and 120 days, but 90 and 30 day notice accounts are common.

How do I access savings from my notice account?

You must give notice to withdraw your money from your notice account. How much notice you have to give depends on the account, i.e. if you have a 90 day notice account you must give 90 days’ notice, and if you have a 30 day notice account, you must give 30 days’ notice.

Once you enter your notice period, you also close your notice account. You can, however, open the same notice account again if you want.

Do you always have to give notice to withdraw money from notice accounts?

Yes. If you find yourself in a financial emergency and can’t wait the full notice period for access to your cash, you’ll pay a penalty. This usually takes the form of forgoing the interest you had earned. If you think you’ll need urgent access to your cash or you’re looking for a rainy day or emergency fund savings account, you may prefer to opt for an easy access account instead.

Can I change my mind after giving notice?

If you’ve given notice that you want to make a withdrawal and then change your mind about needing access to the cash, you’ll need to get in touch with your provider to let them know. If you tell them in plenty of time, it may not affect your account or the number of withdrawals you can make, but every notice account different provider has different terms and conditions to adhere to. 

How is interest earned on notice accounts?

One benefit of notice accounts is the variable interest rate which allows you to grow your savings. Typically, the more restrictions you agree to, such as longer notice period or limited amount of withdrawals per year, the higher rate of interest you may earn.

Notice accounts feature variable interest rates, meaning the interest rate can go up or down while your account is active. Interest rates usually go up or down in line with the Bank of England’s base rate, meaning a lot of economic factors come into play when determining interest rates. 

Most people save in the hope that interest rates will go up, meaning they will earn a better return on their savings. 

Is my money safe in a notice account?

There is very little risk involved when you choose to put your money into a notice account. The largest risk factor to your money is the financial institution itself, or the bank that you open your account with, failing. In the unlikely event that it does fail, most institutions are protected by the Financial Services Compensation Scheme, which allows you to claim back your money, with a limit of £85,000 per person, per institution. 

What are the benefits of notice savings accounts?

Notice savings accounts may be right for you if you want to take advantage of competitive variable interest rates and have the flexibility to withdraw your money after a set notice period.

A notice account from our marketplace might also be right for you for the following reasons:

  • Your money is safe
  • You’ll earn a competitive variable interest rate
  • You can withdraw your money after a set notice period
  • You’re more likely to avoid impulsively spending your savings
  • They’re typically free to open

Pros and cons of notice accounts

When determining whether or not a savings account is the right fit for you, it’s essential to weigh up the pros and cons before committing your funds. To help you do this, we’ve explored a few important pros and cons of notice accounts below.

Advantages of notice accounts Disadvantages of notice accounts
Notice accounts tend to pay higher interest rates than easy access accounts. They require you to provide notice for withdrawing your money, and often charge penalties for withdrawals outside of that period.
This type of account can prevent unnecessary spending due to the restrictive barrier the notice period puts in place. Some notice accounts restrict the number of withdrawals you can make per year.
Notice accounts are a great savings option for offsetting the spending you do in your current account. A notice account might not be your first choice for a rainy day fund as you can’t get instant access to your cash in the event of an emergency.
Most accounts will allow you to top up your account whenever you like. Your attractive interest rate could drop if you allow the balance to fall below a certain amount.

What should I consider when opening a notice account?

  • The amount you want to save
  • Earning the best interest rate
  • How long you’re able to wait before withdrawing your money

If you open a notice account with a variable interest rate, consider checking it regularly and comparing it to other savings accounts, so you know you’re earning the best rate of interest.

You can only make one deposit into your notice account when you open it, and you withdraw your funds by giving notice and closing your account. Because of this, it’s important to consider how much you want to deposit when opening your account, as you’ll earn more from larger deposits.

What are the best notice accounts?

The best notice accounts are generally seen as those that offer the best interest rate. However, finding the best notice account for you will be a balancing act of restrictions against benefits, and whether they cancel each other out. 

Currently, the best interest rate on notice accounts offered on the Raisin UK savings marketplace is XXX AER.

How do I find the best notice account for me?

The right notice account for you will largely depend on your financial circumstances. To narrow down your search, there are some questions you can ask yourself to determine your criteria:

  • How long can you afford to wait between requesting and receiving access to your cash? If you’re looking to set aside an emergency fund to cover the cost of things like breakdowns and damages, you’ll need instant access to the cash, meaning this type of account is probably not the one for you.  
  • What are your savings goals? Do the terms and interest rates of this account help you meet them?
  • How flexible do you want your savings account to be? Are you okay with the potential that you might have to pay a penalty to withdraw early, or be restricted on how often you can withdraw money?
  • Does the deposit requirement meet your needs? Will it allow you to put away the desired amount, or is it too high (or low)? 

Once you’ve got your ideal account outlined, you can look for the closest match by using comparison tables and general research. All of the information you need will be in the account’s terms and conditions, and it’s essential to read them thoroughly to avoid any unexpected surprises or harsh penalties. 

How do I get the best interest rate on a notice account?

Typically, the more restrictions you are able to comply with, the better the interest rate. For example, notice accounts with a longer notice period often offer more competitive rates of interest, but this isn’t always the case. To secure a notice account with the best rate, you’ll need to do some research and compare different providers.

How do I compare notice accounts?

You can compare notice accounts using comparison websites or visiting the website of a specific financial institution. They will have a comparison table that you can refer to in order to assess which type of account is best for you (you can see our notice account comparison table here).

What should I consider when I compare notice accounts?

When comparing notice accounts, it’s essential that you consider the following:

  • Whether you might need emergency access to your cash 
  • What your savings goals are and if this type of savings account will help you meet them 
  • If you have any outstanding debt worth paying off before you tie your money up  
  • All of the terms and conditions set out by the account 

How much can I save in a notice account?

There is typically no set limit on how much you can save in a notice account, but it varies from provider to provider. There is, however, a limit on the amount that you’re entitled to claim back in the event your financial institution fails. This amount is £85,000 per person, per institution, or £170,000 per joint account. 

If you’re looking to save more than £85,000, it’s a good idea to spread it across accounts with different providers. 

Do I need to pay tax on my notice account savings?

The interest you receive on a notice account forms part of your personal savings allowance, meaning you don’t have to pay tax on the first £1,000 you earn in interest if you’re a basic rate tax payer, or the first £500 if you’re a higher rate taxpayer. 

If you do exceed your allowance amount, you’ll need to file a tax return declaring the amount you’ve earned, and subsequently make a tax payment.

Notice accounts FAQs

What are the alternatives to notice accounts?

A fixed rate bond might be right for you if you have a lump-sum deposit that you don’t need to access for a while. You’ll usually get a better interest rate on this type of account, too. Alternatively, an easy access savings account typically gives you more flexibility to access your savings as and when you need.

Is there a penalty for withdrawing money from a notice account?

If you have to withdraw money from your notice account outside of your notice period, you’ll typically pay a penalty for doing so. This will usually mean forfeiting any interest earned, which can wipe out the benefit of opting for a notice account. If you withdraw money in your agreed notice period, there is no penalty for doing so. 

Can you add more money into a notice account?

Yes. You can typically make deposits into a notice account whenever you like. 

Are notice accounts protected by the FSCS?

The vast majority of notice accounts benefit from FSCS protection, meaning you’ll be able to claim back up to £85,000 of your funds in the unlikely event that your institution collapses. 

It’s essential that you check that your provider is covered by FSCS protection before you open your account. 

How many notice accounts can I open?

There’s no limit on the amount of notice accounts you can open. You’ll just need to check that the interest accrued on your accounts doesn’t exceed your personal savings allowance, and if it does, you’ll need to declare it. 

How much money do I need to open a notice account? 

Like many other types of savings accounts, notice accounts usually have a minimum opening deposit. This can range from as little as £1 to as much as £10,000, making them an accessible product even if you have a small deposit. Depending on the amount you deposit, you may also be paid an upfront bonus.

Applying for a notice account

To quickly and easily apply for the best notice savings account for you with competitive interest rates from a range of UK partner banks, register for a Raisin UK Account and log in. It’s completely free to apply and open an account, and once your notice account is open, it will accrue interest at a competitive variable rate.

You can find out more about how to apply by reading our guide to opening a notice account.


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