Avoiding Charges

Most of the charges incurred by a customer maintaining a savings account are payable as a result of using services that are not usually required for management of the account. These charges are imposed to discourage customers from using these services and thus encourage better investment. The best way therefore to avoid charges is to limit the use of specialised services, for example, limiting cash withdrawals and fund transfers to emergencies only. In addition, it is sensible to adhere to the rules surrounding notice accounts (see Notice Accounts). Most notice accounts allow penalty-free withdrawals, providing the bank is informed beforehand. Careful management of your savings is essential to ensure that penalties, whether direct charges or loss of interest, are not levied.

There are many types of savings accounts available and some, such as stock-market-linked accounts, will require expert knowledge in order to reap the full rewards on offer. Brokers' fees and/or recurring charges must be paid on stock market transactions, and if an account holder is risk-averse and/or is wary of such an account due to limited understanding of the investments involved, then a regular savings account may be more suitable and provide the best value.