In a nutshell: There are no get rich quick schemes when it comes to saving. You are protecting, slowly growing and investing your money. Don’t forget that.
If you’re saving for something specific like buying a car & know exactly when you need your money back, a Notice Savings Account might just be perfect for you!
With a Notice Savings Account you usually get slightly higher interest rates, but you have to give your bank a set amount of warning (notice) if you want access to your money.
This could be anywhere from 30 days to 120 days.
What Should You Be Thinking Account When Choosing a Notice Savings Account?
You’ve probably heard me say this before but…saving is easy, you just have to choose to put some money away. So make that choice!
There are pretty much only 4 things you need to think about when looking to open an Easy Access Savings Account:
- How long you’re happy to wait to withdraw your money – You need to think about how impulsive you are and what you’re saving for. Then pick an account with a notice (warning) period that you feel comfortable with.
- How much you want to save – With some savings accounts, you could earn more money if you save over a certain amount.
- The Interest Rate (how much money you will make) – Take a good look at the interest the bank is offering you. You may be able to get a much better deal!
- Is your money safe & protected? – Only put your money into a savings account that is protected by a compensation scheme. This means that if anything happens to the bank, some or all of your money will be protected. That’s golden, and you won’t see anyone running away with your cash!
How Much Notice Do I Need To Give to Take Out My Money?
With a Notice Savings Account you have to let the bank know in advance that you are planning to take your money back. This is called the notice period!
We call it the warning period, as you’re basically warning the bank that you’re going to knock on their door and shake them down for your money.
The most popular notice periods are:
- 7 days
- 30 days
- 60 days
- 90 days
- 120 days
When you’re looking for a Notice Savings Account, make sure you pick an account with a notice period that you feel comfortable with.
Or, you could end up losing money by paying a penalty to take out your money “early”. That’s absolute madness.
So What Happens If I Want My Money Back Early?
This is where things get a little sticky with Notice Savings Accounts!
Some savings accounts won’t let you take your money out until you wait for the notice period that you both agreed.
Other Notice savings accounts will apply a penalty to your account by taking off the amount of interest you would have earned over the notice period.
For example, a 30 day notice account will deduct 30 days’ worth of interest from your account if you take out without giving notice.