Savings Guide

Get more from your savings with our top 10 tips to saving.

Think about what savings product suits you best

Easy or instant access accounts

Principality’s great range of easy or instant access accounts give you access to your money without giving notice. These everyday savings accounts are ideal for saving for a rainy day or a holiday. You can top up your account when you like and make unlimited withdrawals to help you manage life’s ups and downs. Interest rates on these accounts are generally variable.

In short:

  • Easy to set up and manage
  • Access your money when you need it
  • Open an account with as little as £1

Notice accounts

If you’re happy to give advance notice before withdrawal, Principality’s range of notice accounts give you a better return on your savings than you would get with an instant access account. Notice periods typically range from 30 to 60 days depending on the notice account, if you want to take money out or you will lose some interest.

In short:

  • Typically offer higher rates of interest than instant access accounts
  • Notice needed to withdraw your money

Fixed term savings and bonds

Principality’s range of fixed term savings and bonds are for a set period – typically between 1 and 5 years. Leaving your money untouched for a fixed period generally means you get a better return on your investment. You can invest a lump sum or make regular deposits in a Regular Saver Bond.

In short:

  • Usually offer the highest rates of interest
  • You lock away your money for a set period and cannot withdraw it

ISAs

An ISA is an Individual Savings Account. If you save in an ISA, you are entitled to keep all that you receive from that investment and not pay any tax on it.

Principality’s range of ISAs help you grow your savings tax-free and make the most of your annual ISA Allowance.

Whether you want easy access to your money or you’re looking for a longer-term investment, we have a Cash ISA to suit you.

In short:

  • Interest on your savings is tax-free
  • Save your annual ISA allowance in a Cash ISA
  • Easy access, or longer term investments with fixed rates

Saving for under 18s

Principality’s savings accounts for under 18s are a great way to save for your youngster, and a great way to teach them to save.

We offer easy access and regular saver bond accounts. Our Children’s Account rewards your child by giving them a free Dylan the Dragon money box and a personal passbook so they can see their money grow.

In short:

  • A great way to encourage your child to save
  • Easy to set up and manage
  • Open an account with as little as £1

Think about what access you need to your savings

If you need to get hold of your money quickly, then an instant or easy access account is probably the one to choose. Easy access accounts are also great for setting up a pot of money for emergencies.

If you’re happy to give notice to withdraw your money, notice accounts generally pay higher rates of interest than an easy access account.

Remember to check whether the account you choose limits the number of withdrawals you can make.

If you are prepared to invest for a fixed period without needing to access your money, you could choose a fixed term bond to receive a higher return.

Understand how much interest you will get on your savings

The amount of interest you receive on your savings will depend on the savings product you choose.

Some accounts pay interest on a monthly basis, and some annually. The easiest way to compare interest rates across products is to look at the Annual Equivalent Rate (AER). This shows what the interest rate would be if interest were paid and added to your account once each year.

Interest rates are typically shown as gross – that is before income tax is taken off. If you invest in an ISA, you will receive your interest free of tax.

Fixed term savings products, where your money is invested for a set period, will typically offer the highest rates of interest. On the other hand, instant access or easy access accounts with no notice or shorter notice periods, typically offer lower rates of interest.

Variable rate savings products mean that the interest rate can go up and down according to circumstances, for example, a change in Bank of England Bank Rate may affect the rate.

Fixed rate savings products mean you will know exactly how much interest you will earn.

Some Principality accounts include a bonus in the interest rate. This bonus typically only applies for a set period, after which the interest rate will reduce. If you open an account with us that includes a bonus, we will write to you before the bonus comes to an end to give you the opportunity to review your account.

Decide how much you can afford to save

Most regular savings accounts need you to deposit money every month and have minimum and maximum deposit amounts. So it’s important that you decide how much you can afford to save every month.

Principality offer regular savings bonds with minimum initial deposits as little as £20, so even if you don’t have much money to spare, you can still take advantage of a great rate and get into the habit of saving regularly.

Decide if you want to invest a lump sum

If you have a lump sum to invest, the first thing to do is make sure that you have used your annual ISA allowance. Interest on your Cash ISA is tax-free, so this is always a good place to start.

Assuming you’ve used your ISA allowance, before you decide where to invest your lump sum, think about whether:

  • You want easy access to your money or can leave it alone in a longer-term investment for higher returns
  • You would like your interest paid monthly or annually
  • You want a fixed or variable interest rate

Principality offer a range of accounts suitable for lump sum investments.

Make saving money a habit

Decide whether you want to save a set amount regularly or various amounts, as and when you choose.

Interest rates on regular savings accounts are typically higher than those on instant access or notice accounts, though you must meet all the conditions to achieve the higher interest rate.

Principality offer a range of accounts that enable you to save on a regular basis. You can make a regular monthly deposit, or just pay money in as it becomes available.

Saving regularly by setting up a monthly standing order that comes out of your bank account is often the easiest way. Alternatively, you could move over any spare money you have at the end of the month to your savings account.

Make sure you use your tax-free annual ISA allowance each year

You can’t save up your allowance and use it in a different year, so do make sure you use it.

Principality offer a range of fixed rate and variable rate ISAs. See our useful ISAs Guide for all you need to know about these tax-free savings accounts.

Think about how you want to manage your savings

Principality’s range of savings products can be opened and managed in a variety of ways to suit you.

Our eSaver and eISA accounts allow you to manage your savings entirely online.

Alternatively, you can choose an account that’s managed by post, or through your local branch. Check how the account you choose is managed, to ensure it best suits you.

Get your children into the habit of saving

Research shows that children who start early are more likely to save when they grow up*. It can help them understand the importance of managing money.

Principality’s Children’s Account gives your little ones a Dylan the Dragon money box that they’ll love to use to save their pocket money and a personal passbook so they can see their money grow.

Our Dylan’s Regular Saver is an excellent way to save a regular amount each month, from £10 to £150.

* Wardle & McLean Savings Research for Lloyds TSB April 2008.

Choose a reputable savings provider

Why choose Principality?

  • We are the 6th largest building society in the UK with assets of over £8 billion
  • We have been in business for over 150 years
  • We have over 70 outlets across Wales and the borders
  • We have over 500,000 customers
  • Recent research has shown that we are the most trusted and friendliest out of the banks and building societies on the Welsh high street

Principality is covered by the Financial Services Compensation Scheme that was established under the Financial Services and Markets Act 2000. Deposits made by private individuals and small businesses are protected to a maximum level of compensation of £85,000 per person.