Principality Building Society is offering a market-leading 7.5% interest rate on its regular account.
Regular savings accounts typically require people to deposit a set amount each month. They work well for disciplined savers looking to build their savings over time, and they benefit from higher interest rates than standard accounts. Principality Building Society’s account runs for six months, and interest is paid on maturity. Savers can invest up to £200 per month, allowing the pot to grow to a total of £1,200, and withdrawals are not permitted until the account matures.
This account works a bit more flexibly than typical regular accounts, as there is no requirement to contribute every month.
Principality Building Society said: “Our Six Month Regular Saver is designed to help you save on a regular basis over six months. You don’t have to pay in money every month.”
How does the account compare?
While Principality may lead with an Annual Equivalent Rate (AER) of 7.5%, its six-month term limits the total interest earned. With a maximum monthly investment of £200, savers will end the term with £1,227.53, including £27.53 in interest.
In contrast, Zopa offers a 7.1% AER over 12 months with a higher limit of £300 per month, allowing savers to amass £3,600 in total savings. Interest is paid at the end of the term, with a full £3,600 deposit expected to earn around £137, bringing the total balance to around £3,737.
Although the interest rate with Zopa is lower, the longer term and higher deposit limit make it a potentially better option for larger savings.
Unlike many regular savings accounts, savers can withdraw money from the Zopa savings account at any time without penalty.
First Direct also offers a competitive 7% AER over 12 months. The account also allows a monthly deposit of £300, which totals up to £3,600 in savings over the course of a year. At the end of the term, savers will have £3,736.50, including £136.50 in interest. Withdrawals are not permitted until the term ends.
Savers banking with the Co-operative can access a 7% AER on its Regular Saver (Issue 1) for 12 months. You can invest up to £250 per month, building total savings of up to £3,000, earning up to £114.21 in interest. This account also offers more flexibility, as people can make withdrawals without facing a penalty.
Savers are being urged to act quickly to secure the top rates while they’re still available. New data from Moneyfactscompare showed the site’s Average Savings Rate fell to 3.46%, down from 3.50% month-on-month. It is down from 3.80% since September 2024, and lower than 4.29% in September 2023.
It follows the Bank of England’s latest decision to cut the Base Rate to 4% in August.
Scott Gallacher, Director at Leicester-based Rowley Turton, said: “Banks taking advantage of savers is nothing new, but the gap between base rate and what most people earn is stark. Savers need to shop around. In some cases, we’ve secured clients tens of thousands of pounds in extra interest simply by pointing them towards better-paying accounts.”
Eamonn Prendergast, Chartered Financial Adviser at Bromley-based Palantir Financial Planning Ltd, also advised people to do their research: « Plenty of choice for savers, but precious little return. That’s the reality facing savers today. Over the past five years, UK inflation has compounded by around 24%, yet average easy-access rates are stuck at just 2%–3%. People think their money is working for them, but in truth it’s shrinking in real terms.
“If you must hold cash, shop around, use ISAs to shield tax on interest, and know your allowances, because for additional rate taxpayers, those allowances vanish. Inflation is the silent killer, quietly eroding wealth while savers are lulled into a false sense of security.”
