There was good news for savers during February. Six months on from the Bank of England’s base rate rise, rates on savings accounts had finally caught up, with 72% of accounts now offering rates over the current base rate of 0.75%. A total of 1,329 savings accounts had a rate at or above the base rate in February.
In other savings news, research published by UK Finance last month showed that savers have been choosing to put their money into instant access accounts over fixed term savings accounts. Funds saved in high street instant access accounts increased from £626bn in January last year to £642bn in January 2019, while deposits in fixed rate products dropped over the same period, falling from £208bn to £196bn.
Whether you are interested in fixed rates or prefer to have fast access to your savings, our round-up of the best savings rates in February should still make for interesting reading.
Best rates for easy access savings accounts – with bonus
During February two of the best rates for easy access accounts with a bonus came from Marcus by Goldman Sachs and Cynergy Bank, which were both offering a rate of 1.50% AER.
Marcus by Goldman Sachs had its Online Savings Account that included a 0.15% bonus for 12 months and paid interest monthly (resulting in a gross rate of 1.49%), and permitted further additions and withdrawals.
Cynergy Bank was offering the rate of 1.50% AER on its Online Easy Access Account – Issue 21 that could be opened with as little as £1. The account paid interest on its anniversary, with the rate including a 0.50% bonus for 12 months, and also allowed further additions and withdrawals.
Best rates for easy access accounts – no bonus
The savings provider that topped the Best Buy easy access (without a bonus) chart by the end of February was Family Building Society, with its Premium Saver (3) account offering a variable rate of 1.51% AER yearly. This account needed a minimum opening amount of £15,000 and allowed further additions and withdrawals.
Virgin Money held both second and third places in the chart with its Double Take E-Saver Issue 10 and Man Utd Double Take E-Saver Issue 5 both offering a variable rate of 1.50% AER/Gross. Both accounts required a minimum investment of £1 and paid interest yearly, with further additions welcome. However, only two withdrawals would be permitted per calendar year, including closure.
Best rates for fixed rate bonds
During February the provider that topped the Best Buy charts in several sectors was Al Rayan Bank. Its 18-month Fixed Term Deposit account took first place in the short-term sector with an expected profit rate of 2.32% AER (2.30% gross). This 18-month bond required a minimum opening amount of £1,000 and expected profit was paid quarterly, though it did not allow further additions, withdrawals or early access.
In the two-year chart, Al Rayan’s Fixed Term Deposit again offered the most competitive deal with an expected profit rate of 2.42% AER (2.40% gross), and it also topped the three-year fixed rate chart with an expected profit rate of 2.52% AER (2.50% gross) on its 36-month bond. All details of the two and three-year versions mirrored that of the 18-month counterpart.
In the long-term fixed rate bond Best Buy chart, BLME took first place with its Premier Deposit Account (Anticipated Profit Rate) that offered an expected profit rate of 2.75% paid on its anniversary. A minimum deposit of £1,000 was needed to open this seven-year bond, though once opened further additions, withdrawals and early access were not allowed. BLME also offered the top return on a five-year bond, with its Premier Deposit Account paying 2.70% AER.
January 2019 - Best Savings Accounts
Best easy access accounts
The best easy access account with a £1 minimum deposit came from ICICI Bank UK’s HiSave Bonus Saver Account. This account offered savers a flexible saving option where they could make unlimited deposits and withdrawals and gain 1.55% AER on a monthly basis. This account could be opened online and savers could then manage their savings by phone and a mobile app.
For those who had a minimum deposit of £15,000 or more but wanted fast access to their funds, the Family Building Society’s Premium Saver (3) offered the best deal. This account offered a bonus-free deal that paid a variable rate of 1.51% yearly. Savers could then make further contributions until 8 March 2019 up to the £250,000 maximum investment limit and there was a minimum withdrawal of £100. Accounts were able to be opened online, in branch or by post and could be managed all these ways, as well as by phone. For those without the £15,000 minimum opening deposit and who didn’t mind banking online, during January there was also the option of Family Building Society’s Online Saver, which paid a lower rate of 1.26% starting from a minimum deposit of £100.
Compare the best easy access rates here
Best fixed rate bonds
In January, a number of fixed rate bond providers increased their rates. The two best deals for one-year savings accounts came from Gatehouse Bank and BLME. Gatehouse Bank increased its rate last month to offer savers an expected profit rate of 2.15% for the year. It could be opened with a minimum investment of £1,000 and the account was available through the Raisin UK platform, which, depending on the amount deposited, offered a bonus of up to £100. In February the rate was reduced to 2.10%.
BLME dominated the best fixed rate bond deals during January. Its one-year savings account offered savers an expected profit rate of 2.15% on its one-year bond. The bank also offered a number of highly competitive deals for the long-term bond sector. Its seven-year bond paid an expected profit rate of 2.75%, its five-year deal offered 2.70%, while its four-year bond offered an expected profit rate of 2.50%.
In the two-year bond and three-year bond sectors, Al Rayan Bank offered the best January deals. Its two-year bond offered an expected profit rate of 2.42%, which was paid quarterly, while its three-year bond rate offered savers an expected profit rate of 2.52%.
Compare the best fixed rate bond rates here