Savings A-Z

A

AER
This stands for Annual Equivalent Rate (AER) and illustrates what the interest rate would be if interest was paid and compounded once each year. This allows you to compare more easily what return you can expect from your savings over time.  Rates are illustrative only and have been rounded to two decimal places. The AER makes savings rates easier to compare.

Annual Interest
This means the interest is paid on an annual basis.

B

Bank of England Bank Rate
The official bank rate (also called the Bank of England base rate or BOEBR) is the interest rate that the Bank of England charges Banks for secured overnight lending. It is the British Government's key interest rate for enacting monetary policy.

Bond
A bond is a savings account which will earn a fixed rate of interest over a set period of time. The term of the account can vary and the longer the term the higher the rate of interest tends to be.

• Click here to see our range of Fixed Rate Bonds. 

C

Cancelling a cheque
The customer asks the account provider to cancel a cheque that the customer has written.

Cash ISA
An ISA (Individual Savings Account) is designed to enable you to save without paying income tax on your savings. Cash ISAs come in various shapes and sizes, ranging from easy access to notice accounts. Each year you can save up to the annual ISA allowance. 

• Click here to see our range of ISAs.

Cash withdrawals in pounds in the UK
The customer takes cash out of the customer’s account in pounds at a cash machine, bank, building society or Post Office in the UK.

CHAPS
This stands for Clearing House Automated Payment System, which is used to send money payments electronically between banks so they are received on the same day that they are sent.

Compound Interest
This is where interest is added to your total savings balance and your next interest payment is based on the now larger amount. So not only does your saving balance go up, it goes up increasingly quickly.

D

Direct debit
The customer permits someone else (recipient) to instruct the account provider to transfer money from the customer’s account to that recipient. The account provider then transfers money to the recipient on a date or dates agreed by the customer and the recipient. The amount may vary.

Deposit
This is a sum of money paid into a savings account.

F

Faster Payments
A system used to send money payments electronically so they are received on the same day that they are sent.

Financial Conduct Authority (FCA) 
The FCA is the Financial Conduct Authority, a regulatory body in the UK. The FCA regulates financial firms providing financial services to consumers and operates independently of the government. 

Financial Services Compensation Scheme (FSCS) 
The Financial Services Compensation Scheme was established under the Financial Services and Markets Act 2000. Its purpose is to protect your deposits should the West Brom be unable to repay them. Your eligible deposits with the West Brom are protected up to a total of £85,000 per depositor.

Fixed Rate
This is a rate of interest that is fixed for a period of time.

Fixed Term
This is the period of time that money is saved for which is agreed on opening the account. You can't usually access your money during this period so make sure to carefully check the Terms and Conditions of the account to make sure.

Flexible ISA 
This ISA offers the flexibility to withdraw and replace savings within the same tax year without losing the ISA benefits. Please note: the West Brom’s Cash ISAs are not flexible ISAs.

G

Gross
Gross means how much you would earn in interest on your savings account before tax is deducted.

H

Help to Buy: ISA 
An ISA to help first time buyers save towards the cost of buying their first home. Savers will receive a 25% government bonus on amounts saved between £1,600 and £12,000.

HM Revenue & Customs  
HM Revenue & Customs (HMRC) is a government organisation that ensures the correct tax is paid at the right time, whether this relates to payment of taxes received by the department or entitlement to benefits paid.

I

Independent Financial Advisor (IFA) 
A professional who is authorised and regulated by the FCA to advise on suitable financial products after researching the whole market and a customer’s needs and circumstances.

Inflation  
Inflation is the measure of the rate at which prices increase. It’s based on the cost of a basket of goods and services, and is calculated and published each month.

Identification
When you open an account with the West Brom we may need to confirm your identity. For full details on why this is required, and the types of identification accepted, please refer to the Society's Important information on Identification leaflet, which can be found here.

Interest Rate
This is the percentage return that you will receive on your savings. There are Gross, Net and tax-free interest rates, depending on the account that you have.

ISA Allowance
This is the amount you are allowed to invest in a Cash ISA and/or Stocks and Shares ISA which is free of income tax.

L

Lifetime ISA
The Lifetime ISA is designed to help you buy your first home or save towards your retirement. If you are aged 18 to 39, you can open a Lifetime ISA and save up to £4,000 tax-free each year up to and including the day before your 50th birthday. The government will pay a 25% bonus on your contributions, up to a maximum of £1,000 a year. Please note: the West Brom does not offer Lifetime ISAs.

M

Maintaining the account
The account provider operates the account for use by the customer.

Maturity
Maturity or Maturity Date refers to the date when an account reaches the end of its term (in most cases this is the end of a fixed rate period). At the end of the term, the account matures and you can then consider other options for your savings.

Monthly Interest
This is when the interest on your savings is paid on a monthly basis.

N

Notice Accounts
These are savings accounts where the account holder is required to give notice that they wish to access to their account a specified number of days before making a withdrawal. 

P

p.a.
This is short for 'per annum', which simply means, every year.

Personal Savings Allowance 
The amount of interest you can earn on your savings without paying tax. Your allowance depends on whether you're a basic, higher or additional-rate tax payer. Interest from ISAs doesn't count towards this allowance.

Power of Attorney  
A written legal document that gives an individual the authority to act for another person.

R

Refusing a payment due to lack of funds
The account provider refuses a payment from the customer’s account because there is not enough money in it (or it would take the customer past their arranged overdraft limit).

Regular Savings
This is a type of savings account that requires you to pay in a regular amount each month. 

• Click here to see our range of Regular Savings accounts.

S

V

Variable Rate
This is an interest rate that may change over time.

W

Withdrawal
A withdrawal simply means to take money out of an account.