Savings

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Here are the five definitions that we think you'll find most helpful.

Savings bond

A fixed rate savings bond is ideal for you if you want a fixed rate of interest for your savings, for a fixed term with no risk to your capital. There are two big differences between a savings bond and most savings accounts. Firstly, you won't be able to access your money during the term of the bond, so this is for long-term investments only. Secondly, most savings bonds do not allow you to add any more deposits to the original amount invested. Our fixed rate savings bonds offer different interest payment options and a choice of terms (subject to availability). For example, monthly interest allows you to receive a regular monthly income from your savings and an end-of-term option means that interest will be added to your original deposit at the end of the bond term. If you're unsure which savings account is right for you, why not try out our simple savings chooser?

AER

The Annual Equivalent Rate shows what the earnings on your savings would be if interest was paid and compounded once each year. If you have an account that pays interest monthly or quarterly you will only get the full AER rate if you leave the interest in the account for the entire year. Use the AER to compare rates on different accounts and decide which one works best for you.

Monthly interest

Most savings accounts will pay interest monthly. For monthly paying interest, the gross p.a. figure will be less than the AER to allow for compounding. For interest paid annually, the gross p.a. figure will be the same as the AER figure.

Gross pa

The amount of interest paid on an account before the deduction of income tax. Like the AER, you can use the gross pa figure to compare different savings accounts and decide which one works best for you.

Variable rate

A rate of interest that can go up or down throughout the lifetime of the savings account.

Other terms you're not sure of? See our Savings Jargon Buster