Five Top Instant Access Savings Accounts

With the base rate at the lowest it's ever been, where's the best place to stash that cash?

Last week's cut of 0.5% has brought the base rate down to 1%, the lowest it has been in the Bank of England's 315-year history.

And while low rates can spell good fortune for those with variable rate mortgages, anyone with a savings account is bound to feel differently. Indeed, it seems hard to believe that just a year ago instant access accounts regularly paid 6%+ when you realise that the average savings account now earns less than 1%.

Low returns are of course irritating, but not the end of the world for many of us who are of working age. But for those that rely on their savings for income or to top-up their basic state pension, they can be pretty disastrous.

So where should we put our money if we need instant access to it? Normally this is a straightforward question - you look for the account in the best buy tables that best suits your needs and plump for that one.

Bonuses

But, of course, things have changed. Whereas a year or so ago I wouldn't have dreamed of recommending an instant access savings account with a short-term bonus, with rates currently so low they've actually become a selling feature. And with some current accounts paying decent returns on your balance, it could even be worth stashing your savings there.

But if you're looking for an instant access savings account for your cash, here are the current best buys:

Best buy instant access savings accounts

Provider	Account	Investment	Current rate/AER	Bonus?	Do they plan to cut their rate?
ING Direct	Savings	£1-£100k	3.5%	Inc. 1.46% gross bonus fixed for 12 months	Haven't responded to the rate cuts in January or February yet.
Egg	Savings	£1-£100k	3.5%	Inc. 2% variable rate bonus for 12 months	Currently reviewing - haven't made a decision yet
Yorkshire BS	Internet saver	£1-£100k	3.25%	No	Rate was reduced last week - no plans to cut it again
Norwich & Peterborough	E-saver issue 2	£1-£1m	3.25%	No	Currently reviewing - haven't made a decision yet
Barnsley BS	esave	£1-£100k	3.25%	No	No response but assume same as YBS

It's pretty bleak, isn't it? The most we have to get excited about is 3.5% AER which includes a 1.46% bonus. However, things could get even worse - as the last base rate cut occurred last week many providers are currently still deciding whether or not to follow suit.

I gave each of the providers listed above a call this morning to find out what their plans were (results are included above).

Will they cut their rates?

As you can see, the only one to say it has no plans to cut its rates was Yorkshire BS (it reduced the return on its Internet Saver last week from 3.75% to 3.25%). And while I couldn't get a response from Barnsley BS, we could assume that as it has merged with Yorkshire BS, its response may be similar.

Both Norwich & Peterborough BS and Egg are currently reviewing their savings rates in light of last week's cut and haven't made a decision yet (which, of course, means they're watching to see what other providers do first). ING direct is also reviewing its account and, as it hasn't yet responded to January's rate cut (let alone February's), there could well be a savings rate reduction on the cards.

So who knows what will happen to some of the returns above? But from a positive point of view, none of the accounts above require you to make regular payments, you're not punished if you have the audacity to withdraw your own money, and you can open them with just a pound. There are worse places to stash your cash.

Compare all sorts of savings accounts here.

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