Money Saving Expert Martin Lewis has shown how you could get up to 7.5 per cent
Martin Lewis has explained how to maximise your savings(Image: Kate Green, Getty Images)
Martin Lewis has revealed how to achieve a substantially better return on your savings. He shared extensive advice about bank accounts on his BBC podcast.
He offered some important guidance for listeners, including when you should close an existing current account and the various types of savings account available. One question came from a woman who had bought her first property with her husband in October 2025.
They had used a substantial portion of their savings on the mortgage deposit and on home improvements. Now she was looking to rebuild her savings pot.
She explained her existing savings account was offering just 1.05 per cent and sought Mr Lewis’s opinion on the most competitive accounts currently available for growing her savings. She noted they planned to put aside £250 each month into their savings.
In his response, the savings expert told her what should be the initial priority: “The most important start point is you build up an emergency fund of ready cash. You want three to six months of bills, that gives you that financial security, that financial defence mechanism, which is really worth doing.”, reports Wales Online.
“You can have that in any funds, as long as they are easy access.”
Mr Lewis recommended a suitable type of savings account to build this emergency fund would be a regular saver. He clarified: “They’re not for lump sums, they are only for small amounts that you put in each month, but you are exactly in that bag.”
The consumer champion then outlined some of the top-performing accounts in this sector.
The most competitive rate currently available is 7.5 per cent fixed for six months with Principality Building Society, permitting monthly deposits of up to £200. Savers could earn up to £26 in interest over the six-month term.
Mr Lewis said: “The reason you do these is the interest rate is much higher.” Numerous regular saver accounts are currently offering rates of 7 per cent or higher.
This represents a considerable improvement on the best rates of approximately 4.5 per cent available with alternative easy access savings options. Another banking opportunity worth considering, which can significantly enhance your savings, is bonus switching incentives.
Numerous financial institutions will provide cash rewards for moving your current account to them. For example, Nationwide Building Society is presently offering a £175 payment, Santander provides £200 and Lloyds Bank will pay up to £500.
Mr Lewis highlighted another provider worth exploring for this strategy. He said: “First Direct right now is paying switchers £175 to switch to its bank account”.
“Top rate for customer service and then you can save with it for a year at 7 per cent, and you can put up to £300 a month in. So you get £175 and the interest on top.”
Should you deposit the maximum £300 per month into this regular savings account, which offers a fixed rate of 7 per cent over 12 months, you would earn £136.50 in interest. When combined with the £175 switching bonus, your total savings boost would amount to over £311.
The caller expressed her gratitude to Mr Lewis for the tip, admitting she had “no idea” that savings accounts offering a 7.5 per cent interest rate existed.