How good is your current account?

Is your current account working for you? If you’re not getting a good return you may want to think about a savings account.

Have you checked your current account lately? You might have too much money in it.

We know what you’re thinking. You’re thinking: Do I look like a dot com billionaire, off-shore tax haven or Simon Cowell?

Because it sounds bonkers, doesn’t it? How can you possibly have too much money in your current account?

Let Jon Cartlidge, The Nottingham’s Senior Product Manager for Savings and Mortgages, explain.
Jon begins with a question: Do you still have money left over in your current account after you’ve paid all the bills and put a little aside for emergencies every month?

If the answer is yes then you’ve probably got too much money in that account.


Because there are probably better places to store that spare money - dedicated savings accounts, ISAs and investments - that will generally give higher returns.

“The interest rate on a current account might be a fraction of 1%,” says Jon. “Current accounts can be great for paying your bills and getting certain other rewards but the majority aren’t built and designed for saving in.

“If you leave lots of money sitting in a current account, the only real beneficiary is probably the bank.”

A savvy saver “waterfalls” their money, he explains. They take that leftover money they have and let it flow down into a series of savings accounts. This could start with an ISA and if you reach your annual subscription limit you might start another savings account. If you have £100 spare from your salary every month, for example, a regular savings account requiring set deposits might be just the thing.

When you’ve done that, it might also be a good idea to take another look at your current account to see if it is offering the best returns based on your circumstances.

There are a lot of different current account options out there, says Jon. Some will give you money (usually £5 or £10) for depositing a set amount every month. Others offer cash kickbacks based on a percentage of whatever you spend on your mortgage, groceries or petrol every month. Some entitle you to exclusive offers on particular products. Other current accounts will give you access to lower mortgage rates or enhanced interest on savings accounts.

“It’s all about making your money work for you,” says Jon. “It might only take a few minutes to sort but it is definitely time well spent.”

Why not call your nearest building society branch and arrange an appointment to see one of our advisers so you discuss savings or financial products that will help your money go further.

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