Deposit Accounts
Deposits are traditionally offered by banks and building societies. They are designed to protect your money while offering you a fixed or variable interest rate, which can be paid on either an annual or monthly basis.
Deposit accounts offer a safer place for people to place their savings and provide access to their money at short notice, and usually without penalty. They are one of the safest forms of saving; however the buying power of your money could be eroded by the effects of inflation or a drop in the Bank of England base rate – something that has been a particularly important issue in recent years.
Benefits
• Everyone should have some money stored in a deposit account for emergency access (e.g. an unexpected bill) and planned short-term expenditure
• Very low risk
• High level of security – for example, should a UK deposit-taker fall into financial difficultly, as has happened in recent times, the first £85,000 deposited with each Financial Services Authority (FSA) authorised firm is protected under the Financial Services Compensation Scheme (FSCS). Further information about compensation scheme arrangements is available from the FSCS website at www.fscs.org.uk
• Transparent
Potential drawbacks
• Lower returns means deposit accounts are more suited for short-term saving
• Inflation could erode the value of your savings
• Any savings you invest over the £85,000 FSCS limit with a single financial services organisation would not be guaranteed if they get into financial difficulties and were unable to meet their financial obligations to customers
Taxation
• Interest subject to income tax at a rate depending on your tax status. Tax rates are subject to change.
To read about your other investment options, click on the following links:
To find out more about any of
the services we’ve mentioned
simply:
- Contact your SFS Financial Adviser
- Call a member of our Client
Help Line on 0800 137 832 - Visit your local Skipton
Building Society branch to
arrange an appointment with
an SFS Adviser
Assess how much money you need to save to reach future savings targets.
Register your email now for
exclusive news and updates
from Skipton Financial Services.