Our regular savings calculator shows you exactly how your monthly contributions will grow over time. Whether you are saving into a high-rate regular savings account or building a long-term nest egg, enter your monthly amount, interest rate, and the number of years to see your projected total and a full year-by-year breakdown.
Year-by-year breakdown:
| Year | Contributions | Interest Earned | Total Balance |
|---|
A regular savings account is a type of savings account that requires you to deposit a fixed amount every month - usually between £25 and £500 - in exchange for a high interest rate. These accounts typically run for 12 months and are often only available to existing current account holders with the same bank or building society.
The headline rates on regular savings accounts are often the highest available in the savings market (5-8%), which can make them appear very attractive. However, because you build up the balance gradually rather than depositing a lump sum from the start, the actual interest earned is lower than the headline rate might suggest. Our calculator accounts for this with accurate monthly compounding.
| Provider | Rate (AER) | Monthly Limit | Requirement |
|---|---|---|---|
| Nationwide Flex Regular Saver | 8.00% Top Pick | £200 | Nationwide current account |
| First Direct Regular Saver | 7.00% | £300 | First Direct 1st Account |
| HSBC Regular Saver | 7.00% | £3,000 | HSBC current account |
| NatWest Digital Regular Saver | 6.17% | £150 | NatWest current account |
| Lloyds Bank Monthly Saver | 6.25% | £400 | Lloyds current account |
| Santander Regular eSaver | 5.00% | £200 | Santander current account |
Rates approximate as of February 2026. Check providers directly for current rates and terms.
Understanding how regular savings accounts work helps you maximise their benefit:
Most high-rate regular savings accounts require you to hold the provider's current account. This means if you want to access the best rates, you may need to switch your main bank account. Current account switching is free, takes 7 working days, and is protected by the Current Account Switch Service (CASS) which handles all payment redirects automatically.
Some accounts also require you to:
Interest from regular savings accounts is taxable income. However, the amounts are typically small enough to fall within the Personal Savings Allowance:
Regular savings interest rarely triggers a tax liability for basic or higher rate taxpayers due to low interest amounts relative to the PSA.
Save £300/month at 7% for 12 months. Total contributions: £3,600. Interest earned: approximately £126. Total: £3,726.
Best for: Building savings from monthly income, discipline, high headline rates unavailable for lump sums.
Deposit £3,600 now at 5% for 12 months. Interest earned: £180. Total: £3,780. Earns more because the full balance earns interest from day one.
Best for: Those with money available upfront. Always earns more if rates are comparable.
The key insight: a regular savings account at 7% often earns less in absolute terms than a fixed bond at 5% if you have the lump sum available. Use regular savings for ongoing income saving, not as an alternative to investing a lump sum you already have.
For investing in the stock market (not savings accounts), monthly investing - often called pound cost averaging - has a different logic. Regular investing smooths out the impact of market volatility. You buy more units when prices are low and fewer when prices are high, potentially reducing your average cost per unit over time. See our pound cost averaging calculator for stock market investing projections.
When your regular savings account matures after 12 months, you have several options:
The real power of regular savings is not the interest rate alone - it is the habit of consistent saving. Research consistently shows that automating savings (via direct debit) leads to significantly better financial outcomes than relying on willpower alone. Even a modest £100/month saved consistently for 10 years at 5% grows to over £15,500 including interest.
Start with whatever amount you can manage. Increase the amount when you get a pay rise. The compound effect over years is substantial, as shown in the calculator above.
A regular savings account pays a high interest rate in exchange for committing to save a fixed amount each month, typically between £25 and £500. Most regular savings accounts run for 12 months, after which the balance moves to a standard savings account. They are often available only to existing current account customers.
In 2025, the best regular savings rates include Nationwide Flex Regular Saver at 8%, First Direct Regular Saver at 7%, HSBC Regular Saver at 7%, and NatWest Digital Regular Saver at 6.17%. These rates apply to balances saved within their monthly limits.
Rules vary by provider. Some allow you to miss one or two payments per year without penalty. Others may close the account or reduce your rate if you miss a payment. Always check the terms before opening. Most accounts require a direct debit for the monthly contribution.
Regular savings accounts advertise the annual rate, but because you add money monthly rather than depositing a lump sum at the start, you only have the full balance earning interest for one month of the year. On average you have half the final balance invested, making the effective return on your total savings roughly half the headline rate.
Yes, interest from regular savings accounts is subject to income tax. Most basic rate taxpayers are protected by the £1,000 Personal Savings Allowance. On £500/month at 7% for 12 months, total interest is around £182, well within the PSA for most people.
After 12 months, most regular savings accounts mature and the balance transfers to a standard easy access savings account, usually at a much lower rate. At this point, compare rates and consider moving the money to the best-buy instant access account or a fixed rate bond.
If you have a lump sum available, depositing it all upfront in a high-rate fixed bond or easy access account usually generates more interest because the full amount earns interest from day one. Regular savings accounts are better for those building savings from monthly income, or where the headline rate is significantly higher (e.g. 7-8% vs 5%).