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Product focus: Fixed rate bonds

Product focus: Fixed rate bonds

Category: Savings

Updated: 01/08/2011
First Published: 26/07/2011

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
The average length of time a fixed rate bond is on the market for has fallen to just 37 days, the lowest level since December 2008.

Since base rate has been at its all time low of 0.50%, the average length of time bonds have hung around for has typically been over 100 days, peaking at 133 days in October 2009.

Bond rates have been on a downward spiral for the last few months, so if savers want to secure the best deals they need to act fast as the best deals are oversubscribed quickly and then withdrawn.

Here is a selection of the current best bond deals:

Hanley Economics Building Society – Fixed Rate Bond Issue 62

  • The highest rate for customers looking for a one year bond is being offered by Hanley Economics Building Society who is paying a rate of 3.50%.
  • Customers bringing new money to the provider can invest between £1,000 and £100,000 into the bond, which is operated in branch or by post.
  • Further additions are permitted whilst the bond remains open, but earlier access is not allowed.

United National Bank – 3 Year Fixed Deposit

  • Savers looking for a medium term commitment are being offered a rate of 4.25% from United National Bank.
  • Savers can commit between £1 and £1 million into the bond, with a monthly interest option available for savers after a regular income.
  • The bond is operated in branch or by post, but once opened further additions and earlier access is not permitted during the three year term.

Birmingham Midshires – 5 Year Fixed Rate Bond

  • Birmingham Midshires is paying a rate of 4.65% for customers committing funds for five years.
  • Savers can invest up to £1 million into the bond, which also offers a monthly interest option for savers after a regular income.
  • Further additions can be made into the postal operated account whilst the issue remains open.
  • Earlier access is available, but all withdrawals will be subject to a 365 day' loss of interest penalty.

Find fixed rate bonds best rates here

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 Any products featured may be withdrawn by their provider or changed at any time.