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Product focus: Fixed rate bonds

Product focus: Fixed rate bonds

Category: Savings

Updated: 03/02/2010
First Published: 03/02/2010

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 It is now over 6 months old so the content may be out of date.

One year fixed rate bonds are a safe and effective place to lock away cash, particularly as the likelihood of interest rates increasing sharply over the next twelve months remains reasonably slim.

Fixed rate bonds tend to pay a slightly better return than other types of accounts, as the premise is that savers will leave funds alone during the term.

If access is required within the term, savers can expect to incur penalties such as loss of interest.

Here are the current top one year bonds, which all require minimum deposits of £1,000.


Firstsave – Fixed Rate Bond Issue 10

This account pays a rate of 3.65% on maturity. Savers can make deposits up to £2 million. A monthly interest option is also available at 3.59%, although savers must be aware that this option requires a minimum deposit of £5,000. Early access and further additions are not allowed. The account can be operated online only by savers aged 18 and over.


ICICI Bank UK – HiSAVE Fixed Rate Account

Another online only account, this pays a rate of 3.40% on its anniversary. A monthly interest option is also available at 3.34%. There is no maximum investment limit. Earlier access and further additions are not allowed. An HiSAVE Savings Account is opened automatically for the administration of maturity proceeds. The account can be operated by savers aged 18 and over.

National Counties Building Society – 38th Issue Savings Bond

This account pays an annual rate of 3.25%. Savers can invest up to £150,000. A monthly interest option is available at 3.20%, although the minimum deposit required is £5,000. No earlier access or further additions are allowed. The account can be operated in branch, or by post or online by savers aged 18 and over.

Find the best savings account for you - compare short term fixed rate bonds

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 Any products featured may be withdrawn by their provider or changed at any time.

 
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