Saving Money as a Contractor

Having access to a savings account means you can save money whilst earning interest at the same time. If you already have a savings account, you’ll have most likely noticed a drop in your interest rate over recent years. As a limited company director, there are some steps you can take to ensure you maximise your interest.

Online versus high street

Over recent years, online saving accounts with more attractive rates of interest have become increasingly popular. This is an option worth considering, as you will receive more money as a result of this higher interest rate. As a contractor, this type of account is ideal as it can be managed on the move or at home.

If the online offering doesn’t appeal to you, don’t worry. Whilst providing lower interest rates than online savings accounts, providers on the high street can still offer you a competitive rate.

Flexible saving

If you would like to deposit and withdraw money whenever you want, an instant access/easy access savings account will provide you with the flexibility you need. This does come at a cost, as the interest rate is usually lower. If you would like a pot of money available in case of emergencies, you could benefit from this type of account.

Locking away your money

If you don’t immediately need your money, tying up your savings for a longer period can be a great way of maximising your returns. Savings bonds give you the opportunity to take advantage of higher interest rates. The general rule is that the longer you can commit your money for, the higher your interest rate will be. Accessing your money may be restricted during the term of your savings bond, so make sure you do your research before tying up your money.

Here for the long-term

Now that you’ve found the perfect savings account that suits your needs, why not let us take care of the rest? At Nixon Williams, your dedicated accountant will look after your business finances. If you have any queries, call us on 01253 843184 or send us an email.