Savings update: Britons could secure 5% interest rate before Christmas – are you eligible?

Martin Lewis lays out the best savings deals available

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The Cambridge Building Society is offering five percent interest on their Extra Reward Regular Saver account. This now makes them one of the elite few that are offering interest higher than the current inflation rate which could be a saving grace for many in light of the holiday season.

The Cambridge Building Society was founded in 1850 with the goal of helping individuals to fund their own homes and provide them the best possible opportunities to save. 

Now, the saver account is doing just that, with a market leading five percent interest rate, above the current 4.2 percent inflation. 

Additionally, the interest rate on offer is also tax-free so savers will not need to pay tax on interest that may exceed their Personal Savings Allowance.

This means it is one of the very few accounts on the market that will see savers earning money instead of losing value as time goes on. 

The savings account is available with a minimum investment of £100 and the interest rate is calculated on the account balance at the end of each day. 

In essence, savers can begin earning this sky high interest from the first day they move their funds until the account matures one year later.

This aspect could see many being able to fund the expensive holiday season that is so well deserved after a turbulent year. 

The account also offers a fixed interest rate which will guarantee the five percent interest until the account matures.

Extra Reward Regular Saver accounts can be opened remotely via telephone or post as well as through any Cambridge Building Society branch.

To be eligible for the account and its incredible interest rate, one must be a long-standing client of Cambridge Building Society. 

Savers must have held a separate savings or mortgage account with the building society for at least three years.

Those who are eligible for the account should be wary that they can only hold one type of regular saver account with the society at any given time. 

This includes the Extra Reward Regular Saver as well as the Regular Saver and Reward Regular Saver accounts.

The minimum deposit to open the account is £100 and people can save up to £3,000 in the form of £250 monthly instalments. 

Savers can make as many deposits in one month as they please so long as the maximum monthly deposit amount of £250 is not exceeded. 

If a saver misses their monthly deposit there are no penalties but their deposit allowance will not be carried forward to the next month.

The maximum amount any one person can hold in all of their accounts with the building society is a total of £2million. 

Withdrawals, however, are not permitted during the fixed term in order to receive the incredible interest rate. 

Closure of one’s account will be subjected to a 90 day interest penalty fee which will be taken from one’s capital balance if they have not built up enough interest at the time of closure.

When the account has matured, the balance as well as the accrued interest will be transferred into an appropriate instant access account.

Savers are advised to read the terms and conditions for both this product and the Cambridge Building Society’s general savings terms and conditions before deciding whether to open their account. 

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