Interactive Investor

Best savings rates this week

24th June 2020 08:00

Stephen Little from interactive investor

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Whether it's for a rainy day or for a one-off big purchase, it's crucial to make your savings work hard for you. 

Moneywise reviews regular, children's savings, fixed rate and easy access accounts with the best savings rates currently on the market. These accounts are our Best Buys.

Remember, these rates are before tax, but most people can earn £1,000 interest from savings tax-free (depending on your income tax rate). In any case, if you haven't used your Cash ISA allowance this tax year, getting an Isa should be your first port of call. See our round-up of the best Cash ISA rates.

Unless otherwise specified, all these banks are individually licenced by the FCA, so your savings will be covered by the Financial Services Compensation Scheme (FSCS) up to £85,000. All interest rates are AER - the annual equivalent rate.

Best easy access savings accounts

If you're looking for an account where you can access your money quickly, then a no-notice deal is a good idea. Just remember, the interest rate on these accounts is variable so it could decrease down the line.

Also, watch out for sneaky terms and conditions - not all easy access accounts offer unlimited withdrawals, so shop carefully. 

NS&I Income Bonds 1.16%
Open this account online with a deposit of £500.

Family Building Society Market Saving Tracker 1.13%
This account can be opened online with a deposit of £500.

NS&I Direct Saver 1.00%
You can open this account online with a deposit of £1.

Top notice accounts

If you are happy to wait a little while before accessing your savings, rates on notice accounts tend to be higher than easy access savings. Some won't allow early access at all, though others may let you withdraw without notice, subject to losing some interest. 

The Melton Building Society 1.36% Online 100 Day Notice 1.36%
This account can be opened online with a deposit of £1,00.

ICICI Bank UK Raisin UK - 45 Day Notice Account 1.25%
This account can be opened online with a deposit of £1,000. Note, you will need to open an account with the Raisin savings platform.

Family Building Society 35 Day Notice Saver 1.10%
Open this account online with an initial £1,000 deposit. 

Best fixed rate savings accounts

Fixed rate savings accounts are normally aimed at people with a lump sum that they wish to lock away for an agreed period.

Interest is fixed so your return is guaranteed, unlike easy access and notice accounts, which tend to be variable. However, do bear in mind that withdrawals and further deposits are rarely allowed.

Top one-year bonds

Al Rayan Bank Fixed Term Deposit 1.10%
Open this account online with an initial deposit of £1,000. Note, this account's rate is an expected profit rate (EPR). Find out what this means in our guide.

Ikano Bank 1 Year Fixed Term Saver 1.01%
This account can be opened with a mobile app with a deposit of £1,000.

Habib Bank Zurich Fixed Rate eDeposit 1.00%
You can open this account online with a deposit of £1,000.

Best two-year bonds

Al Rayan Fixed Term Deposit 1.41%
Open this account online with an initial deposit of £1,000. Note, this account's rate is an expected profit rate (EPR). Find out what this means in our guide.

PCF Bank 2 Year Fixed Term Deposit 1.16%
You can open this account with a deposit of £1,000.

Gatehouse Bank Fixed Term Deposit 1.15%
Open this account online with an initial deposit of £1,000. Note, this account's rate is an expected profit rate (EPR). Find out what this means in our guide.

Top three-year bonds

Al Rayan Bank Fixed Term Deposit 1.51%
Open this account online with an initial deposit of £1,000. Note, this account's rate is an expected profit rate (EPR). Find out what this means in our guide.

Ikano Bank Fixed 3 Year Saver 1.21%
Open this account online with a deposit of £1,000.

Gatehouse Bank Fixed Term Deposit 1.20%
Open this account online with an initial deposit of £1,000. Note, this account's rate is an expected profit rate (EPR). Find out what this means in our guide.

Best five-year bonds

RCI Bank Fixed Term Savings Account 1.40%
This account can be opened online with a deposit of £1,000.

Ikano Bank Fixed 5 Year Saver 1.36%
Open this account online with a deposit of £1,000.

Top regular savers

The current economic backdrop has not only highlighted the importance of saving, but means more people would like to do it little and often.

First Direct Regular Saver 2.75%
For deposits between £25 and £300 per month. The rate is fixed for 12 months and is only available to current account customers. Can be opened online or by phone.

HSBC Regular Saver 2.75%
For deposits between £25 and £250 per month. The rate is fixed for 12 months and available to current account customers. Can be opened in branch or by phone.

M&S Bank Monthly Saver 2.75%
Rate available on deposits between £25 and £250 to its current account holders. The interest is paid annually, and the rate is fixed for 12 months. Can be opened online, by post, over the phone or in branch.

Best open-to-all regular savers

Coventry Building Society Regular Saver 1.85%
This account pays 1.85% on deposits up to £500 per month. This account is transferred to a lower paying easy-access account after one year.

Top savings accounts for children

Putting cash aside for your kids is always a good idea, and the interest rates tend to be much higher than offered in adult accounts. Here are our top picks for children's savers.

Halifax Kids' Monthly Saver 1.45%
This is the top 12-month bond. You can deposit between £10 and £100 in the account each month. Must be opened online or in branch.

How are Moneywise Best Buys selected?

We look across as much of the of the savings market as possible to find the best deals using industry data from Defaqto.

All our picks are nationally available - online, by post or by phone. We try and pick products that are available to both new and existing customers, but we’ll highlight some offers for existing customers if they’re much better than what else is on offer.

Unless rates are significantly higher than on other accounts, we avoid products that pay an initial bonus (which is normally a euphemism for a rate cut after 12 months), or those with tiered rates (these may not pay the advertised interest rate if your balance rises above or falls below a set amount).

Deals only available to particular age groups or for “additional subscriptions” are also not included.

All these savings accounts are covered by the FSCS unless otherwise specified. We will prioritise products from UK-based providers. If your bank is licenced by another European country, savings up to €100,000 will be protected, but by the government where the bank is headquartered, rather than the UK authorities.

We reserve the right to use our discretion at all times.

This article was originally published in our sister magazine Moneywise, which ceased publication in August 2020.

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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