Key savings account terms you should know

Offering higher interest rates than transaction accounts, and with some throwing in bonuses for making regular deposits, savings accounts are designed to help you grow your money.

Whether you’re saving for a house, a holiday or a rainy day, choosing the right account may help get you there faster.

This glossary of key terms may come in handy when comparing savings accounts and features.

What types of accounts are available?

Cash management accounts

Cash management accounts act as a hub for managing your finances, investments and mortgages alongside daily transactions.

Everyday transaction accounts

A transaction account is the account you use on a day-to-day basis for bills, expenses and withdrawals. You’re less likely to earn high interest on one of these accounts.

High interest savings accounts

High interest savings accounts are exactly as described: accounts where you benefit from a higher interest rate. Sometimes these rates are a part of a temporary promotional or introductory offer. It’s a good idea to check what the rates will revert to after the introductory period ends.

Incentive/bonus saver accounts

Incentive accounts offer a bonus rate of interest when you adhere to their conditions – for example, making at least one deposit per month and no withdrawals. They often have no monthly fees and can be a good option if you don’t plan to spend or move your money.

Kids’ savings accounts

If you’re looking to teach your kids how to save, a high interest children’s savings account could be the answer. These accounts may offer incentives for monthly deposits, and bonus interest for not making any withdrawals.