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6 of the best long-term bonds

6 of the best long-term bonds

Category: Savings
26/04/2018

With inflation seeing a welcome decrease in March, there are once again fixed rate bonds that can beat it. While you will have to say goodbye to your savings pot for at least five years to get an inflation-beating return, the current economic and political uncertainty might make it a great time to seek some fixed bond security.

Long-term bonds could also be perfect for those with big purchases planned in the next few years – a wedding or a house deposit, for example. Just remember that you'll rarely be able to withdraw funds before the end of the term, and few bonds allow further additions either, so you'll have to be comfortable with both the level of investment and the term chosen from the outset.

If you're confident that you won't need the cash for a few years and are ready to secure a decent return, it's time to get searching. To help you on your way, here are the current top six Long-term fixed bonds that could help you get more from your money.

AER Details
PCF Bank
PCF Bank
7 Year Term Deposit Issue 6
2.75%
AER
  • £1,000 minimum deposit
  • Rate fixed for seven years
  • Rate fixed for seven years
  • Withdrawals and early access not permitted
  • Account can be opened by post or online, and then operated over the phone as well
  • Interest paid on anniversary and must be paid away

PCF Bank takes the top spot with this deal that pays an inflation-beating return of 2.75%, making it the joint market-leader in this sector. It can be opened with £1,000 and allows additions for 14 days, offering some flexibility. However, interested savers must be willing to lock away their funds for seven years, as early access will not be permitted.

AER Details
Secure Trust Bank
Secure Trust Bank
7 Year Fixed Rate Bond
(28.5.25)
2.75%
AER
  • £1,000 minimum deposit
  • Rate fixed until 28.05.2025
  • Additions of at least £1,000 permitted while the issue remains open
  • No withdrawals or early access allowed
  • Must be opened online, but can then be managed by phone as well
  • Interest paid yearly

In second place is this account from Secure Trust Bank, which also pays the market-leading 2.75% over seven years – provided you've got a minimum of £1,000 to invest. This account allows additions while it remains open to new subscribers, but no early access, so savers must be happy to set their funds aside for the whole term.

AER Details
Secure Trust Bank
Secure Trust Bank
6 Year Fixed Rate Bond
(28.5.24)
2.70%
AER
  • £1,000 minimum deposit
  • Rate fixed until 28.05.2024
  • Additions of at least £1,000 permitted while the issue remains open
  • No withdrawals or early access allowed
  • Must be opened online, but can then be managed by phone as well
  • Interest paid yearly

Secure Trust Bank manages to get another account in the top three with this six-year deal that pays a rate of 2.70%. Its other features match the bank's seven-year offering, making this a potentially attractive deal for those investors reluctant to set their savings aside for seven years.

AER Details
Secure Trust Bank
Secure Trust Bank
5 Year Fixed Rate Bond
(28.5.23)
2.66%
AER
  • £1,000 minimum deposit
  • Rate fixed until 28.05.2023
  • Additions of at least £1,000 permitted while the issue remains open
  • No withdrawals or early access allowed
  • Must be opened online, but can then be managed by phone as well
  • Interest paid yearly

Secure Trust Bank does it again with a hat-trick of deals next to each other in the charts – this time paying 2.66% over five years to sit in fourth place. So, if you liked their other bonds but would prefer a slightly shorter term, this account could be for you.

AER Details
Vanquis Bank
Vanquis Bank
Vanquis Bank Savings
Go to Site
2.65%
AER
  • £1,000 minimum deposit
  • Rate fixed for five years
  • No additions, withdrawals or early access allowed
  • Access via nominated current account
  • Must be opened online, but can then be managed by phone and post as well
  • Interest paid on its anniversary

Next up is this account from Vanquis Bank, which boasts a rate of 2.65% over five years for those with at least £1,000 to invest. While the usual fixed bond access restrictions apply, this could be a good choice for those looking to set their funds aside for only five years – and the rate is still inflation-beating.

AER Details
United Bank UK
United Bank UK
5 Year Fixed Term Deposit
Go to Site
2.65%
AER
  • £2,000 minimum deposit
  • Rate fixed for five years
  • No additions allowed
  • Withdrawals and earlier access possible at the bank's discretion, and subject to 365 days' loss of interest
  • Access via nominated current account
  • Can be opened online, in branch or by post, but then operated by post and in branch only
  • Interest paid on anniversary and must be paid away

Completing the top six is this deal from United Bank UK, which also pays a rate of 2.65% over five years, this time on a minimum investment of £2,000. It has the unique distinction of being the only account in this round-up that allows earlier access, though this is given at the bank's discretion and would result in a year's loss of interest, so savers should think carefully before deciding to withdraw funds from this flexible account.

Information & Rates correct as at: 26/04/2018

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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