Savings - fixed rate savings bonds - the best rates in 6 years! - Savings - News - Moneyfacts

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Savings - fixed rate savings bonds - the best rates in 6 years!

Savings - fixed rate savings bonds - the best rates in 6 years!

Category: Savings

Updated: 31/10/2008
First Published: 25/09/2007

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

A war is currently being waged in the one year fixed rate bonds savings market, which is great news for savers as we've witnessed fixed rate savings deals at levels not seen for over six years. As the recent sub prime mortgage crisis and subsequent stock market volatility has made it even more difficult for banks to borrow from one another, Financial institutions are now battling it out in an effort to bring in the most amount of money through their doors, by targeting savers to help them raise additional funds.

The results of the ensuing battle in the first few days of September were remarkable - the first shot was fired by Northern Rock's6.71% one-year fixed rate bond, closely followed by Derbyshire's6.85%, which was then trumped by West Bromwich's 6.86%.

It seems that a ceasefire has yet to be called - a week later we saw the launch of Birmingham Midshire's 6.91% 11-month Internet bond, which was quickly surpassed by Stroud and Swindon's 7.05% bond to December next year.

Institution

Term

Account

New rate

Stroud & Swindon

1 Year

Fixed Rate Bond 57

7.05%

Birmingham Midshires

11 months

Internet Fixed Rate Bond

6.91%

Anglo Irish Bank

1 Year

Fixed Rate Bond

6.90%

West Bromwich BS

1 Year

E Bond 11

6.86%

Derbyshire BS

1 Year

Fixed rate Bond 152

6.85%

For more information visit our Savings best buy charts

Before rushing to open up a one-year bond, you should consider your tax position first. If you are a taxpayer, then opening an Individual Savings Account (ISA) and using your full yearly allowance should be the first port of call because all of the interest you earn on your savings will be free from tax. Our Mini Cash ISA best buys indicate that the interest rates on mini cash ISAs are currently very attractive and you don't have to lock away your money for a year.

There is no guarantee just how long it will be before the situation returns to some sort of normality in the money markets, so if you want a 7% savings account, make sure you act sooner rather than later!

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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