You can get a regular income by choosing to have your interest paid monthly, but not all savings accounts pay out in this way.
Which accounts can offer monthly interest?
You can have your interest paid to you monthly from a wide variety of savings accounts, including:
Fixed rate bonds: tie your money up for a set term with a fixed interest rate
Fixed rate cash ISAs: same as fixed bonds but you save using your tax free ISA allowance
Help to Buy ISAs: available to first time buyers only
Instant or easy access accounts: let you take your money out when you want
Offshore savings accounts: you save your money in an account abroad
Make sure you decide on the level of access to your money you want before choosing an account as many will tie your money up for a set term.
Can you have your interest paid into another account?
Some let you have your monthly interest paid into an account with another bank or building society.
This means you can take what you earn each month without having to wait for your interest at the end of the year.
When is monthly interest better than annual interest?
When you want to earn an extra monthly income from the interest on your savings.
If you do not need your interest paid each month, you could earn more with an annually paid savings account.
Our table shows the AER interest rate, which tells you exactly how much interest you earn each year as opposed to compounded interest.
Monthly interest savings account FAQs
Do I have to tie my money up to get monthly interest?
No, there are some easy access accounts that let you have your interest paid out monthly, but most accounts do tie your money up for a set term.
Is monthly interest taxed the same as annual interest?
Yes, and the same rules apply if you are eligible for a personal savings allowance. Find out more about savings interest and tax here.
Can I withdraw my money in a monthly interest savings account?
Most monthly interest accounts require you to tie your money for a set term, however some let you withdraw when you want.
Can I have my interest paid into a separate account?
Yes, you can have your interest paid into another account held with the same provider or some let you have your interest paid into another provider.
Can I have my interest paid into my current account?
Yes, most let you if it is with the same bank or building society, and some let you pay your interest into an account held somewhere else.