Compare personal savings accounts in the UK

A personal savings account is a deposit account in your own name that pays interest on your money. Here are the key facts for the 2026/27 tax year:

• Protection: eligible deposits are protected by the FSCS up to £120,000 per person, per banking licence.

• Bank Rate: 3.75% (held on 17 September 2026; next decision 5 November 2026).

• Average rate actually earned: 1.65% on instant-access balances and current accounts, against 4.24% on new fixed-term deposits (Bank of England, August 2026).

• Tax-free interest: £1,000 a year for basic-rate taxpayers, £500 for higher-rate, £0 for additional-rate.

• ISA allowance: £20,000 a year, all of which can go into a cash ISA until 5 April 2027.

• Rates are usually variable on easy access accounts, so they can change at any time. Fixed-rate bonds pay a guaranteed rate in exchange for locking your money away.

What is a personal savings account?

A personal savings account is a bank or building society account, held in your own name, that pays interest on the money you deposit. Unlike a current account, it isn't designed for everyday spending: you usually move money in and out through a linked current account.

Personal savings accounts are for individuals, as opposed to business savings accounts. You can hold one on your own or jointly with another person. Most are opened online or in an app, and most UK accounts are protected by the Financial Services Compensation Scheme (FSCS).

Which type of personal savings account is right for you?

The right type of personal savings account depends on when you'll need the money. The more access you give up, the higher the rate tends to be.

How much interest will a personal savings account pay?

Over a year, the interest you earn is roughly your balance multiplied by the AER, if you leave the interest in the account. £10,000 at 4.00% AER earns about £400 in a year.

The AER (Annual Equivalent Rate) already includes the effect of compounding, so it lets you compare accounts that pay interest daily, monthly or yearly. The gross rate is the rate before compounding. For example, 4.41% gross paid monthly works out at 4.50% AER.

A bonus rate isn't always the better deal. Here is £10,000 in two easy access accounts, assuming rates don't change:

Account A wins over two years, but from year two Account B pays more. If you leave your money in Account A after the bonus ends, Account B catches up in year four. The bonus end date is your cue to compare again.

Paid plans and fees. Some providers pay a higher rate only if you pay a monthly subscription. To check whether it's worth it, divide the yearly fee by the extra rate:

Break-even balance = yearly fee ÷ extra interest rate

A £15 monthly plan (£180 a year) that adds 1 percentage point only pays for itself on balances above £18,000 (£180 ÷ 0.01). Below that, you'd earn more on the free plan.

What are UK savings rates right now?

Updated 20 October 2026. The Bank of England held Bank Rate at 3.75% on 17 September 2026, and the next decision is due on 5 November 2026. Inflation is 3.1%, and markets expect Bank Rate to rise rather than fall over the coming months.

Most savers earn far less than Bank Rate. In August 2026 the average rate paid on UK households' instant-access savings and current accounts was 1.65%. New fixed-term deposits paid 4.24% on average, and existing fixed-term deposits 3.41% (Bank of England effective interest rates).

If your savings earn less than inflation, their spending power falls even though your balance grows. Moving money from a low-rate account is often the simplest way to earn more.

Is my money safe in a personal savings account?

Yes, up to a limit: if a UK-authorised bank, building society or credit union fails, the FSCS protects eligible deposits up to £120,000 per person, per banking licence. The FSCS aims to pay most people back within seven days.

• Per licence, not per account. Some banks run several brands under one licence. Money across those brands shares a single £120,000 limit.

• Joint accounts: each holder is protected up to £120,000, so a joint account is covered up to £240,000.

• Temporary high balances: money from events such as a house sale or an inheritance can be protected up to £1.4 million for six months.

• App-based savings: some apps hold your savings with a partner bank. Your protection then depends on that bank, and it's shared with anything else you hold there. Check the account's terms to see which bank holds your money.

FSCS protection covers your deposits, not the interest rate: the rate on a variable account can still fall.

Do you pay tax on savings interest?

Most people pay no tax on savings interest, because of the Personal Savings Allowance. In 2026/27 it lets you earn this much interest tax-free each year:

At 4.00% AER, a basic-rate taxpayer would reach the £1,000 allowance with about £25,000 saved. A higher-rate taxpayer would reach £500 with about £12,500.

Starting rate for savings. If your other income is low, you may earn up to £5,000 more interest tax-free. This £5,000 falls by £1 for every £1 of non-savings income above your £12,570 Personal Allowance.

How the tax is collected. Banks pay interest without deducting tax. If you owe tax, HMRC usually collects it by adjusting your tax code, or you pay it through Self Assessment.

Cash ISAs. Interest in an ISA is always tax-free and doesn't use up your Personal Savings Allowance. In 2026/27 you can pay up to £20,000 into ISAs, and all of it can go into a cash ISA.

What's changing from 6 April 2027:

• Income tax on savings interest is set to rise by 2 percentage points, to 22%, 42% and 47%.

• The cash ISA limit is set to fall to £12,000 a year for people under 65. The overall ISA allowance stays at £20,000, and people aged 65 or over keep the full £20,000 for cash.

This is general guidance, not tax advice. Check GOV.UK or speak to a qualified adviser about your own situation.

Can savings affect your benefits?

Yes, for means-tested benefits such as Universal Credit. Savings and other capital count towards your entitlement, together with your partner's:

For example, £8,000 in savings adds £34.80 a month of assumed income (£2,000 ÷ £250 × £4.35). Other benefits, such as Pension Credit and Housing Benefit, have their own rules. Money in a cash ISA still counts as capital.

How to choose a personal savings account

Start with when you'll need the money, then compare accounts of that type on these points:

1. The AER over the time you'll save, not just the first year. A 12-month bonus matters less if you'll save for three years.

2. The rate after any bonus, and the date it ends.

3. What you need to unlock the rate: being a new customer, holding a current account with the same provider, or paying for a plan.

4. Withdrawal rules: limits on the number of withdrawals, daily transfer caps, or a lower rate if you withdraw too often.

5. Minimum and maximum balances, and whether a lower rate applies above a certain amount.

6. Who holds your money, and whether you already have savings under the same banking licence.

7. Tax: whether your interest could go over your Personal Savings Allowance, which would make a cash ISA worth comparing.

How to open a personal savings account

Most personal savings accounts can be opened online or in an app in a few minutes. Before you start, have these ready:

1. Eligibility: you usually need to be 18 or over and a UK resident. Some accounts also require UK tax residence or an existing current account with the provider.

2. ID: a passport or driving licence. App-based providers often ask for a selfie or short video.

3. Your details: address history and, for a cash ISA, your National Insurance number.

4. A nominated account: a UK current account in your name, used to pay money in and receive withdrawals.

5. Your first deposit: many accounts accept £1. Check whether the rate depends on depositing within a set number of days.

How we compare personal savings accounts

We list personal savings accounts from providers we work with commercially. Our panel changes over time and doesn't cover the whole market, so other accounts may pay more.

For every account we check the AER against the provider's own terms and summary box, along with the rate after any bonus, any fee or paid plan needed to get the rate, eligibility, withdrawal limits and which bank holds your money. We review rates every week and after every Bank of England decision. Partner products are shown first by default; you can sort by interest rate instead. For more: How we rank.