My CFO on the Go!

IceSave - A Great Bank for Our Friends in the UK

This blog is mostly focused on tax, savings, and business issues in the USA.  But the internet is making the world smaller and I have many readers from around the world. So this post is for all of you in the UK.

You should know by now that I think that everyone needs to be saving for the future.  Not just adults, but children also. One of the best things a parent can do, to get their children started right financially, is to open a savings account for them.  You can save for your child’s college education, or just for their future needs, but it is important to start early and show your children the advantage of saving money. If saving money becomes a habit for your children that will be well on their way to financial success!

IceSave is an online bank, open to UK residents, that offers savings accounts that are safe, easy to use, and offer attractive interest rates.   I really like their Easy Access account. It has a low opening balance requirement, and a very attractive variable interest rate. Currently at 6.30% the interest rate is guaranteed to be over the Bank of England Base rate by at least 0.35% until 1 May 2011.  After that, it is guaranteed no not be less than the Bank of England Base rate until 1 May 2013.  And my favorite part of the deal?  There are no fees. You can take your money out of the account at any time without any fees or penalties.  I am always annoyed at banks that pay low interest rates, and then charge fees for every transaction.

Your money will be safe with IceSave.  They were founded in Iceland in 1886 and have been in the UK since 2000. They have a strong credit rating and provide the same level of financial protection as every bank in the UK.

So if you are in the UK, get your kids started out right and open an account for them with IceSave.

Earn 3.5% Interest Risk Free

If you are serious about becoming debt free, one of the things you must have is an emergency savings account. But not just any savings account. Many major banks today are paying dismal interest rates, often under 1%. And to top it off they have monthly service charges and minimum balance requirements that can make it where you are actually losing money on your savings account. Especially when you are just starting your savings plan and don’t have a lot of money to save, you need a savings account with no fees and no minimum balance requirements. And, as you progress in your debt reduction and savings plan you will probably end up with thousands of dollars in your emergency savings account. You need to earn the most interest possible, while keeping your funds safe.

This is where online banks come in. Online banking is safe and reliable. You can link your online savings account to your regular checking account, so getting to your money is easy. But not so easy that you will be tempted to make impulse purchases with your emergency funds. And many online banks typically pay much higher interest rates on savings accounts.

I really like HSBC direct. If you open an account before September 15, 2008 you can earn 3.50% APY* in Online Savings. Thats 9 times higher than the average savings interest rate. What makes this even better is that there are no fees for this account, and no minimum balance requirements. You can open an account for as little as $1, and did I mention, no fees. That means no minimum balance fees, no service charges, nothing to cut into the interest that you are earning. Plus your money is FDIC- insured.  You can deposit with confidence.