When working out whether a 3-year fixed rate bond is for you, remember to consider what you think will happen to interest rates:
When taking out a fixed rate bond, you are usually not supposed to withdraw your cash for a specified period of time – in this instance, it will be for three years. Most 3-year fixed rate bonds do not allow you access to your money once it’s been deposited until the bond matures. Where early withdrawals are allowed, a considerable interest penalty will almost certainly have to be paid.
Many of the best rates available on 3-year fixed rate bonds are offered by smaller, relatively unknown banks who are new to the market. These are often referred to as challenger banks.
Learn more about challenger banks
As all banks and building societies listed by moneyfacts.co.uk must be UK-licensed and part of the Financial Services Compensation Scheme (or an equivalent), you can be safe in the knowledge that the first £85,000 you have saved is protected if the bank or building society were to go bust.
Learn more about depositor protection
Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.