for savers

The interesting guide to interest rates

Savings account interest – the most interesting thing about your savings

Every saver wants to earn as much interest as possible, but understanding how different aspects of interest rates affect your savings requires some attention to detail. Our guide below can help you get to grips with the basics.

With a savings account from The Cambridge you earn interest from the day you pay funds into your account until the day before you withdraw your funds.

We calculate interest on the balance of your account at the end of each day and it is paid annually.

Annual interest is paid on 31st December and depending on the account you choose it can be added to the balance of your account, transferred to another Cambridge account or to an external account with another bank or building society.

Interest will be paid at the gross rate with no tax deducted.

Tax treatment and rate of interest payable will depend on individual circumstances and may change in the future.

 

Notification of interest rate changes

When interest rates increase we'll advertise the new rates, within three working days of the change, in at least two local newspapers (usually Cambridge News and their 'News' Series), by placing notices in our branches and on our website.

When interest rates reduce, and the change is material, we will personally tell you about it at least 14 days before we make the change. Please refer to the Terms and Conditions for Savers for a more detailed explanation.

 

Current interest rates

Interest rates may change depending on factors such as inflation, supply and demand and the general economic climate. You can find out what your current savings interest rate is by looking at our Savings products or you can take a look at our previous rates for variable savings accounts here.

 

Interest rates explained

- The Gross Rate is the contractual rate of interest payable before deduction of income tax at the rate specified by law.

 

- The Annual Equivalent Rate (AER) is a notional rate which illustrates what the gross interest rate would be if interest was paid and added to the account annually. AERs on an account which pays monthly interest assumes interest is added to the account at the end of each month during the year. In practice, the option to have interest added in this way is not available on our monthly interest accounts.

 

- The Tax-free rate is the contractual rate of interest payable where interest is exempt from income tax.

 

We calculate interest on the balance of your account at the end of each day. You earn interest from the day you pay funds into your account until the day before you withdraw your funds.

Tax treatment and rate of interest payable will depend on individual circumstances and may change in the future.

 

 

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