Pick the best Post Office saving account interest rate

Trying to find a decent saving account interest rate in the current economic climate is tricky. You are lucky if you can even keep up with inflation. Among the familiar names on the high street, the Post Office offers some reasonable saving account deals.

The Post Office (www2.postoffice.co.uk) provides a range of accounts to suit differing needs, from instant access accounts, to longer-term bonds.

The Online Saver account is easy to open, for balances from £1 to £2 million. You have instant access to your cash at all times. The interest rate of 3.01% gross does include a bonus element of 1.36% for the first 12 months. After that the account reverts to a lower interest rate. This is a common (if annoying) practice with savings accounts. You just have to be alert about when your attractive rate in ending, and shift your money at the right time.

If you are prepared to tie up your money, you can find better interest rates with an Online Bond. These can be for a year or 2 years, with gross interest rates of 3.41% or 3.96% respectively. There is a minimum deposit of £500 and maximum of £2 million. There are no additional deposits or withdrawals permitted during the duration of the bond.

The Post Office also offer the government's National Savings and Investments accounts. These are suitable for customers who are a little wary of online accounts. You are given an old-fashioned passbook and make withdrawals and deposits over the counter.

Your money is 100% secure with an NS & I account, but the downside is that the saving account interest rate is very low, around 0.30%. For more advice on NS & I accounts go to www.nsandi.com.

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