With savings rates shifting again, regular savers are quietly becoming a powerful tool for discipline and decent returns.
Households weighing flexibility against reward now face a fresh choice. A big high-street name has pushed out a rate that turns heads, while rivals flash headline figures with stricter rules.
How the deal works
Nationwide Building Society is promoting a 6.5 percent AER on its Flex Regular Saver. The product targets people who want to drip-feed cash every month rather than stash a lump sum.
Up to £200 per month. Maximum £2,400 saved across 12 months. Interest paid on the anniversary.
The account opens with just £1. Interest compounds and credits on the account’s anniversary. You can make three withdrawals with no penalty, which adds useful breathing room for a tight month. A fourth withdrawal triggers a sharp rate cut to 1.25 percent for the remainder of the term.
Make more than three withdrawals and the rate drops to 1.25 percent, so plan your safety buffer.
Who can apply
Eligibility sits with UK residents aged 16 or over who already hold a Nationwide current account. The deal suits people happy to commit up to £200 each month, and those who value emergency access without losing the headline rate straight away.
What you might earn
Because money enters in monthly chunks, you earn interest only on the time each deposit has been in the account. That means the headline rate does not translate into 6.5 percent on £2,400 for a whole year. The provider’s own example suggests a pot of £2,400 could earn about £84.50 over 12 months at the current rate, assuming you pay in the maximum each month and keep withdrawals to three or fewer.
- Monthly deposit cap: £200
- Total possible deposits in 12 months: £2,400
- Illustrative interest over 12 months: around £84.50
- Penalty-free access: up to three withdrawals
- Rate after a fourth withdrawal: 1.25 percent
How it compares
Regular savers still feature striking AERs, though many set tight rules. Some pay more on paper but limit access or shorten the term, which can curb the pounds-and-pence outcome.
| Provider | AER | Term | Max monthly | Total paid in | Access | Estimated interest | Estimated total |
|---|---|---|---|---|---|---|---|
| Nationwide Flex Regular Saver | 6.5% | 12 months | £200 | £2,400 | Three withdrawals without penalty; 1.25% after a fourth | ~£84.50 | ~£2,484.50 |
| Principality Building Society | 7.5% | 6 months | £200 | £1,200 | No withdrawals until maturity | £27.53 | £1,227.53 |
| Zopa | 7.1% | 12 months | £300 | £3,600 | Withdrawals permitted without penalty | ~£137 | ~£3,737 |
| First Direct | 7.0% | 12 months | £300 | £3,600 | Typical regular saver conditions apply | ~£136.50 | ~£3,736.50 |
The table shows the trade-off. A higher AER can sit alongside stricter rules, like no withdrawals until maturity or a shorter term that caps the interest earned in pounds. Nationwide’s 6.5 percent brings more flexibility, which may fit real life better for many households.
Key questions to ask yourself
Do you need access during the year?
If you expect to raid your pot, three penalty-free withdrawals give Nationwide an edge over rivals that lock funds to maturity. Frequent dips would still blunt your return, so pair this with a separate easy-access buffer if you can.
Can you hit the monthly cap?
The headline return assumes disciplined monthly payments. A standing order helps. Missing months reduces interest because less money spends time in the account. Paying in near the start of each month can slightly lift the outcome because funds sit longer.
Will a later rate drop hurt your plan?
A regular saver often reverts to a different account at the end of the term. Diary the maturity date. Decide in advance whether to roll the money into a new regular saver, move to a high-paying easy-access account, or split between the two.
Mark the anniversary, review the new rate, and be ready to move the cash within days.
Ways to squeeze more from regular saving
- Automate payments for the first working day of each month to maximise days on deposit.
- Use a separate emergency account so you keep your three Nationwide withdrawals intact.
- Stagger start dates across different providers to create a monthly maturity ladder.
- Keep notes on caps and rules to avoid rate cuts or closure penalties.
Tax, protections and small print
Interest counts towards your Personal Savings Allowance. Basic-rate taxpayers can earn up to £1,000 in interest before tax. Higher-rate taxpayers get £500. Additional-rate taxpayers have no allowance. If your interest pushes you over the threshold, expect tax through self assessment or an adjustment to your code.
Eligible UK deposits with banks and building societies usually sit under the FSCS limit of £85,000 per person, per institution. Regular savers rarely reach that level, but watch group brands when you diversify.
Rates can change. AER helps you compare like-for-like, as it reflects compounding. The pounds you earn depend on when you pay in, any withdrawals, and whether the rate moves during your term.
A quick simulation to guide your plan
Imagine two savers using Nationwide’s cap. Saver A pays £200 on the first of each month. Saver B pays on the last day. Both contribute £2,400 across the year. Saver A keeps the money in slightly longer, so earns a little more interest than Saver B. The difference is small on these sums, yet it grows if you repeat the strategy over several years. Timing does not beat the rate, but it can nudge the total in your favour.
Who might benefit most
New savers who want structure will find the monthly cap manageable. Families building a rainy-day pot may appreciate the three no-penalty withdrawals. People hunting for the top headline number might still pick a 7 percent-plus rival, accepting stricter rules in exchange for a few extra pounds of interest.
If you value flexibility and still want a solid return, 6.5 percent with three lifelines is a rare mix.
Final checks before you apply
Confirm you hold a Nationwide current account and meet the age requirement of 16+. Note that a fourth withdrawal lowers the rate to 1.25 percent, so plan for emergencies elsewhere. Set up a standing order for up to £200 per month. Make a reminder for the anniversary to avoid parking the pot on a weaker follow-on rate.
If you are building larger savings, combine a regular saver with an easy-access account and, where suitable, a cash ISA for tax efficiency. Use the regular saver for discipline, the easy-access pot for day-to-day shocks, and the ISA to protect interest when your allowance runs thin. This mix keeps momentum while keeping your options open.
Nationwide’s 6.5% with three penalty‑free withdrawals feels like a real‑world safety valve. I can live with ~£84.50 on £2,400 given the monthly drip—it rewards discipline without locking me in a vault. Not perfect, but practical for households with bumpy cashflow.
Isn’t 6.5% a bit of a mirage if the pounds‑and‑pence is only ~£84.50? With Zopa at 7.1% and £300 cap, wouldn’t the total interest be higher for somone who can max it each month, given similar access? Genuine Q—what’s the catch I’m missing?