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Three simple steps to boost your cash

Having a savings strategy could better the returns on your savings – and it’s easier than you think. We’ve taken a look at three simple steps to help you make the most of your savings.

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

With interest rates falling, savings rates are under threat. The average instant access account currently pays a small 0.41% including unconditional bonuses. That’s just £41 on a savings pot of £10,000, after one year.

Savings rates are likely to get worse, following the Bank of England’s decision to slash the base interest rate to 0.10%. It’s now more important than ever to get your savings working harder. Doing nothing could cost you dearly.

Our easy, three-step plan can help you.

1. Fixing your savings

It’s important to keep three to six months’ worth of income in easy to access cash for things like a broken boiler or losing your job. But all your other savings should be working harder.

Most fixed term savings products give you a better interest rate than easy or instant access accounts. But you can’t normally access your money until the product term ends so you need to be sure you won’t need it until then. You can fix for as little as three months, to over five years – you’ll normally get better rates if you fix for longer too.

A fixed rate also gives you the peace of mind that you know exactly where you stand. And it will shelter you from any future interest rate falls. Remember though, if rates rise, you’ll miss out.

See the great selection of fixed rate savings available with Active Savings.

2. Don’t put all your eggs in one savings basket

You don’t have to choose between the flexibility of an easy access account and the better returns available from fixed term savings. It doesn’t have to be one or the other.

You can blend easy access options with multiple fixed term products of different lengths depending on your needs. This gives you regular access to the money that’s held in easy access accounts, while also getting a better overall rate from your varying fixed term products. Rather than simply leaving it all in an easy access account.

Here’s an example of splitting a £10,000 savings pot:

In this example, easy access lets you access a quarter of your money whenever you want. And you’ll have access to more of your savings every six months. The longer fixes should earn you a better rate, boosting your overall return. Whichever options you choose, you will of course need to take your own circumstances and the product rates available into account.

3. Do it without the hassle

Few of us have the time or inclination to scour the market searching for better rates. And then opening an account with each bank – needing to prove who you are time and time again.

Luckily there’s a much easier way.

Active Savings lets you pick and mix savings products from different banks and building societies all through one online account. There’s easy access and a number of fixed term products to choose from, with great rates up to 1.63% (AER/Gross*).

You only have to open one account. Once you’re set up, you can save across multiple banking partners with no extra paperwork. You’ll also see all your savings together in one place, making them easy for you to look after.

Get started today

It’s easy to get started with Active Savings. You can apply in just a few minutes.

Discover Active Savings

This article isn't personal advice, but could help you make your own decisions so you can make more of your money. If you’re unsure of the suitability of a product for your circumstances, please ask for advice. Remember inflation reduces the future spending power of money.

*AER (Annual Equivalent Rate) shows what the interest rate would be if interest was paid and compounded once each year. It helps you compare the interest rates on different savings products.

Gross means the interest rate without any tax deducted. Interest is paid gross. You’re responsible for paying any tax due on interest that exceeds your Personal Savings Allowance to HM Revenue & Customs. Tax treatment can change.

This website is issued by Hargreaves Lansdown Asset Management Limited (company number 1896481), which is authorised and regulated by the Financial Conduct Authority with firm reference 115248. The Active Savings service is provided by Hargreaves Lansdown Savings Limited (company number 8355960). Hargreaves Lansdown Savings Limited is authorised by the Financial Conduct Authority under the Payment Services Regulations 2017 with firm reference 751996 for the provision of payment services. Hargreaves Lansdown Asset Management Limited and Hargreaves Lansdown Savings Limited are subsidiaries of Hargreaves Lansdown plc (company number 2122142).

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

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