Together, we Brits have more than £900 billion in easy-access accounts, ideal to dip into when we need to raid our savings.
If we listen to financial advisors, it is where we keep between three and six months of salary.
Now an easy access account is gaining popularity with a new feature: the limited access offer.
Last week, Paragon released a new version that propelled it to the top of the best buy charts.
With limited access accounts you can withdraw money two to four times a year.
Earn 5.78% interest with this 365-day notice account that beats the best one-year solutions
Popular: With limited access accounts you can withdraw money two to four times a year. You can go over the limit but then your rate will plummet for the rest of the year.
You can exceed this limit, but your rate will plummet for the rest of the year. Or you should close the account to get more money.
You can, for example, keep £5,000 in an easily accessible ordinary account that you can draw on whenever you see fit (shoes! theatre! paddle board!).
But for everything else, including planned expenses like flights and vacations or a new car, these limited access accounts can be very useful.
Providers also benefit because the money is more likely to stay in the account than in an easily accessible regular account.
The Paragon Double Access Number 7 account pays 5.05 per cent, is available online with a minimum of £1,000 and allows you to make two withdrawals every 12 months.
It’s well ahead of the easy-access ordinary account average at 3.11 per cent, data examiners at Moneyfactscompare say.
You can make more withdrawals, but you will pay a high price if you do so. Its rate drops to 1.5 percent for the rest of the year.
After the 12 months have passed, your rate resets to the highest rate on the anniversary of your account opening.
Yorkshire BS pays 5 per cent into your Rainy Day Saver account on balances up to £10,000. You can make as many withdrawals as you want, but only two days a year.
If you need to earn more, you can close the account.
Some easy-access regular accounts pay more than 5 percent. Oxbury Bank’s new limited edition Easy Access is priced at 5.02 per cent, but you need to keep at least £20,000 in the account.
Savers can expect these rates to fall when the Bank of England’s base rate falls from its current 5.25 per cent, which could happen as early as June 20.
Supermarket benches ready to pay
When Tesco Bank and Sainsbury’s Bank came on the scene almost 30 years ago, they threatened the big banks.
Suddenly you could open savings accounts online, over the phone or even doing your weekly shop.
But they stopped operating in stores years ago and are about to retreat further. Sainsbury’s Bank imposed huge cuts this week on the fixed rate bonuses it is offering to new customers. Its two-year rate has dropped from 4.2 percent to 2.5 percent for new savers.
Its variable rates for new accounts also drop 0.9 percentage points. Your cash Isa rate has fallen from 4.4 per cent to 3.5 per cent.
The Bank of England kept the base rate at 5.25 per cent, making it difficult to see the cuts as anything more than a liquidation of its savings arm.
Meanwhile, Barclays is about to buy Tesco Bank and plans to offer Tesco-branded savings products.
Sy.morris@dailymail.co.uk
