Halifax offers competitive 5.5% interest savings account

Halifax is offering savers a competitive 5.5% interest rate on its Regular Savings account. Both existing and new customers aged 16 and over can apply for an account online; alternatively, those who have registered for Halifax's online banking can open an account via the app.

Regular savings accounts work well for people looking to build a savings pot, as the rules typically require depositing a set amount each month and making minimal to no withdrawals.

Using Halifax's account, savers can deposit between £25 and £250 per month, meaning a maximum of £3,000 can be saved over the 12-month term.

The 5.5% interest is a fixed rate for 12 months from account opening, and it will be paid when the account matures.

When applying for the Savers Account, Halifax will also open an Everyday Saver account.

After 12 months, any money you've saved in your Regular Saver plus interest will transfer into the Everyday Saver account, after which the Regular Saver will renew for another year.

You cannot withdraw any money from the Regular Account until after the 12-month term. However, once the money is transferred into your Everyday Saver account, there are no limits or rules on withdrawals, and no charges apply.

Everyday Saver accounts can be opened with just £1 and have a 0.75% AER on balances from £1 - £24,999, 0.90% AER on balances from £25,000 - £99,999, and 1.00% AER on balances of £100,000 or more.

The interest is paid 12 months after the account is opened.

Unlike the Regular Saver account, this interest rate is variable, meaning it can change over time. Halifax says it will inform customers of any changes in advance.

Principality Building Society tops the table for regular savers with an Annual Equivalent Rate (AER) of 7.5%. The account runs for six months, and interest is paid on maturity. Savers can invest up to £200 per month, which means the pot can grow to a total of £1,200, and withdrawals are not permitted until the account matures.

With a maximum monthly investment of £200, savers will end up with £1,227.53, including £27.53 in interest. So, while it may have a market-leading AER, its six-month term limits the total interest earned.

Zopa offers a 7.1% AER over six months, with a maximum monthly limit of £300, allowing savers to accumulate £1,800 in total. Interest is paid at the end of the term. Savers are allowed to withdraw money from the Zopa savings account at any time without penalty.

However, they'll only be able to replace the money within the monthly allowance of £300. For example, if you withdraw £500 but want to put money back in, you can only deposit up to £300.

First Direct is just behind with a 7% AER over 12 months. The account allows a monthly deposit of £300, which can accumulate to £3,600 in savings over a year. At the end of the term, First Direct says savers will amass around £3,736.50, including £136.50 in interest.