Savings Accounts - Frequently Asked Questions
Definitions
AER
AER stands for Annual Equivalent Rate. This is the amount of interest earned within one year. AER is useful for comparing the return on savings accounts because it shows how much will be earned regardless of how often interest is credited to an account. It is standard practice in Ireland to list interest in AER form for savings accounts. AER is usually quoted without taking DIRT into account.
Account types
Child Saver/Parent Saver Account
A Child Saver or Parent Saver account is an account that is set up by a parent or guardian for the benefit of a child. Accounts can be set up solely or jointly in the name of the parents. Child Saver accounts are generally used to save for the benefit of a child (i.e. future education costs), often provide instant access and pay competitive interest.
Demand Account
A demand account is an interest bearing account that allows withdrawals and deposits at any time and for any amount. The number of withdrawals is usually not restricted. A demand account may pay a different rate of interest depending on the balance and may limit the amount that can be held on deposit. A demand account is ideal for a customer that may have a lump sum and requires access without notice.
Fixed Rate Account
Fixed Rate deposit accounts pay interest on a fixed rate that is guaranteed not go up or down for a set period of time.
Instant Access Account
With an Instant Access Account, funds can be withdrawn at any time. An instant access account is similar to a Demand account but may have some restrictions. Common restrictions may be a limit to the number of times money can be withdrawn in one year, or a limit to the amount that can be withdrawn at any one time. Some Regular Saver accounts offer instant access, but may still require regular monthly deposits.
Joint Account
A joint account is an account controlled by two people. Both parties can add funds to or withdraw funds from a joint account. Joint accounts are commonly set up by married persons or partners.
Notice Account
A notice account is one in which the account holder must provide the bank or building society a minimum amount of notice before making a withdrawal. Withdrawals can usually be made from notice accounts without notice but may be subject to a penalty. The penalty for making withdrawals without sufficient notice is usually a loss of interest. The notice required for withdrawal can vary from 7 to 40 days. In general, the longer the notice, the higher the interest rate.
Regular Saver
A Regular Saver is an account designed for customers that wish to make regular monthly deposits. Some Regular Saver accounts also permit the addition of lump sums. Regular Saver accounts frequently require notice before making a withdrawal and usually pay competitive rates of interest. Regular Saver accounts are useful when saving for big purchases or events such as home deposits.
Term Account
A term account is also considered to be an investment account. The term is the length of time that the investment is made. Most term accounts do not permit withdrawals or further deposits for the duration of the term. Term accounts typically offer a higher rate of interest.
DIRT
DIRT stands for Deposit Interest Retention Tax. When interest is paid into an account by banks and building societies, DIRT is deducted and forwarded to the Revenue Commissioners. DIRT is currently charged at a rate of 30%.
Interest rates
Gross Rate
The gross rate is the actual interest rate paid on a deposit or savings account. The gross rate does not take compounding into account. It is common to see the gross rate side by side with AER on savings account advertisements. The gross rate is often slightly lower than AER.
Interest Rate
The interest rate quoted on savings accounts is the amount earned by savings and can be variable (can go up or down) or fixed (will not change for a set period of time). The interest rate is expressed as a percentage.
Variable Interest Rate
Variable interest rates are those that are offered by banks or financial institutions that are liable to change i.e. they can go up or down.
Standing order
A standing order is an automatic way of paying a fixed regular amount from an account. Standing orders are usually paid from a current account to another account. For example making a monthly payment into a regular savings account or paying down a loan.
FAQ
Why should I switch savings account?
Switching your savings account can significantly increase the amount of interest that you earn and switching is easy.
Most money on deposit in Ireland is kept in demand accounts earning as little as 0.01%, or one hundredth of one percent. This is known in banking terms as "sleeping money" because it is not earning for the account holder. Finding the best savings account through bonkers.ie is quick and straightforward and you can begin earning top interest within a few days.
Example: A customer with €10,000 in a standard demand account earning 0.01% will earn just €1 per annum. Switching to a high yield demand account earning 3.10% will earn €310 per annum. If you are prepared to lock your money away for a term or provide notice before making a withdrawal, you can earn even more.
What do I need to change savings account or open a new account?
Opening a new savings account is simple and straightforward and you can start your application through bonkers.ie for most accounts. Banks are required to verify the identity of a new account holder so copies of your personal identification may be required. A copy of your driver's license or passport will generally be accepted.
You may also need to provide proof of address, which can usually be done with a utility bill, insurance statement or any document issued by the revenue commissioners.
Finally, you'll need to provide your PPS number along with a document that verifies it like a P45, P60 or a Social Services Card.
How does it work?
bonkers.ie provides an up-to-date list of Irish savings accounts. You can compare all savings accounts by interest rate or if you want to narrow your search, you can use our "Help me choose" feature, which will help you find the right account for you.
bonkers.ie is impartial which means we list by the best rates. If you want to search for Demand Accounts or Regular Saver accounts, you can do that easily too.
When you have chosen the right account, you can usually get the application process started through bonkers.ie. Just click the "Apply" button. If you want to see more account details including features and interest rates just click on the "Details" button.
Submitting an application
When you have found the right savings account, you can usually get the process started through bonkers.ie by completing a brief application - we may also guide you to the correct application for your chosen account
Once you have submitted your application, you may be asked to provide some follow-up documentation by your chosen bank or financial institution. This is to verify your identity and your address.
Once you have completed your application and provided the relevant documentation, your new account should be opened within a few days.
What are the advantages of using bonkers.ie?
bonkers.ie is a trusted and impartial comparison service. We provide a comprehensive and up to date list of savings accounts available in Ireland that you can easily compare.
bonkers.ie takes the legwork out of looking for the right account or the best interest rate. We'll also help you choose between demand accounts, regular savers, term accounts and lump sum deposit accounts.
Best of all you can begin the application process right here on bonkers.ie.
How do you keep rates up to date?
bonkers.ie makes every effort to make sure that rates are up to date. In some cases, financial institutions provide rates to bonkers.ie even before rate changes are announced. bonkers.ie also adheres to a rate schedule where all accounts and rates are regularly checked for changes