We’ve watched easy access account rates fall heavily over recent months, which in turn has made the humble and old fashioned notice account a new unlikely hero. While easy access rates plummeted, notice accounts have offered some of the best variable rates available – well above easy access and at times matching or even beating short term fixed rate bonds.
At the end of October the best notice account rate stood at 3.20% AER (Hanley Economic BS 180 days’ notice), however the current best rate has now dropped to just 2.50% AER for new customers (Melton Mowbray 90 days’ notice).
Unfortunately we haven’t seen the end of the savings rate slaughter. The good news is that, as with the majority of other savings accounts, these rate reductions are generally only of concern to new savers. However, Julian Hodge Bank has cut its rates twice since the beginning of October, for existing customers, on its once table-topping Extra High Interest Deposit account (90 days’ notice). But if they want to switch to somewhere else, those existing savers have to give 90 days’ notice to move their money – obviously that is the drawback with notice accounts.