BEFORE SIGNING up for a product or service, whether it’s online or face to face, I like to have all the information to hand so that I can make an informed decision before parting with my cash.

And financial products are no different; it’s important to me that I plump for something that ticks all the right boxes.

However, when it comes to choosing the right savings accounts, the vast array of products and confusing marketing tactics make this task far harder than it should be. Best buy tables available online and in newspapers are great for highlighting the interest rates payable on anything from an instant access account through to a fixed-rate bond or individual savings accounts. Yet the rate, no matter how attractive, is only part of the story.

To give yourself a more complete picture, consider the following questions:

• Is the interest rate variable or fixed, and if fixed, how long for?
• Is there a guarantee that the interest rate will not fall below a certain level – if yes, how long does this guarantee last?
• Can I make withdrawals – if yes, how frequently and are there any fees or penalties for doing so?
• Is the interest rate conditional on me taking another product – e.g. a current account or stocks and shares based investment?
• Does the interest rate quoted include a bonus – if so how much is it and when does it expire?

The credit card industry has made it much easier to shop around and check account features in just a few seconds by implementing an industry wide ‘summary box’ containing all the key interest rate and account details in a standard format.

This is a blueprint that savings providers would benefit from adopting, because like many people, once I find a product that meets my criteria and I receive a decent standard of customer service, I’m likely to remain a loyal customer for many years.

Tricks to watch out for

If there’s something that always brings a wry smile to my face it’s when I see a headline grabbing interest rate in a newspaper advert way above those topping the best buy tables. I know that if I delve into the terms and conditions I’ll soon discover the reason why the rate is too good to be true - there’s at least one hidden ‘nasty’ in there every time.

If I see something labelled ‘instant access’ I don’t expect to find that I’ll receive no interest for that month if I make a withdrawal. Similarly, I think the terms ‘premier’, ‘platinum’ and ‘privilege’ are over used and often a misnomer; especially when you see accounts paying interest rates of close to nothing.

Picking the right account in the current climate can be a minefield, but by asking the questions above, you won’t go far wrong.

Issued by Sainsbury’s Finance
Sainsbury’s Finance is a trading name of Sainsbury’s Bank plc. All information correct at time of publication, but may be subject to change. Any views or opinions expressed in this article are the responsibility of the author and do not necessarily reflect the views of any part of the Sainsbury’s Group of companies.

Sainsbury’s Finance is a financial services provider engaged in savings accounts, credit cards, and personal loans. It also supplies insurance services in car insurance, home insurance, life insurance, pet insurance and travel insurance as well as being a provider of travel money services.