Babyready accounts

Individual Savings Accounts (ISAs) can give you somewhere to keep your money and benefit from tax advantages.​

For the 2021/2022 tax year, the ISA limit is £20,000 and you won’t need to pay tax on the interest your ISA earns. There are a range of different ISAs available​.

Advantages​

• Any interest you earn is tax-free​
• If you choose an easy-access ISA you can still have instant access to your cash​
• You can make regular monthly payments or occasional lump sums, depending on what suits you​

Disadvantages​

• You can only put in up to a maximum of £20,000​
• The best interest rates are only available if you tie up your money for a fixed term​

Regular savings accounts tend to run for 12 months, and require you to pay in a set amount each month.​

There are usually stricter rules about how much you can pay in and take out. Usually not allowed to access your money during the 12-month term.​

Advantages​

• Attractive interest rates​
• Low minimum monthly payments​

Disadvantages​

• Inflexible as you’ll usually have to pay in money regularly to the account​
• Unsuitable if you need emergency access to your money​​

Easy access savings allow you to dip into your savings at short notice with no penalty. Also known as instant access savings accounts, these types of account are simple bank accounts that let you earn interest on your balance. You can deposit as much cash as you like into the account – at any time – and withdraw it whenever you want, without having to pay any fees or charges. Many of these accounts also come with a bank card you can use to make ATM withdrawals and pay for purchases.

Advantages​

• Immediate access to your money at any time, free of charge​
• Deposit as much cash as you like, whenever you like​
• Very small initial deposit​

Disadvantages​

• Low variable interest rates​
• You may have to pay tax on the interest​