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You Are Here: Home > Personal Finance > Banking & Saving > Top 3 accounts > Top 3 Fixed Rate
Top 3 Savings Accounts

1-2 Year Fixed Rate Bonds
Updated :
Every Monday
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Last update :
06 Feb
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Current interest rate :
0.5%
Unsure what a Fixed Rate Saving Bond is - Then see this 5 minute guide

RIP OFF ALERT

Be Wary of Fixed Rate Savings Bonds with Strings Attached

Some of the banks and building societies have been introducing sneaky and quite frankly immoral savings deals, but then should we expect any less from institutions who's MO seems to be to try to fleece their customer base wherever possible.

The deals work like this -

  1. They offer an unbelievably high paying fixed rate savings bond (perhaps offering 4.25% fixed for 1-year where the current best buy deal only pays 3%), but
  2. In order to qualify the saver has to invest an equal amount in a Guaranteed Equity Bond (GEB)

Guaranteed Equity Bonds are notoriously opaque investments where the majority of people won't be able to properly work out what they're actually buying.

Nor, more importantly will they be able to work out the exact costs and whenever a bank can hide the true costs of a product anyone who thinks they're not going to financially exploit their customer base is naïve - Read this Daily Mail article for an idea of how customers are viewed (including the comments at the bottom).

My advice is simple - Run from any bank/building society that tries to sell you one of these deals as you're being setup.
1 Year Savings Bonds
The AA
Account name :
 1 Year Fixed Rate Account
Length :
 1 year
Interest Rate :
 3.60% fixed
Net interest rate :
 2.88% (20% taxpayer)
2.16% (higher rate)
Withdrawal restrictions :
 Early withdrawals are not allowed during the term
Minimum opening balance :
 £1
Misc :
More Details :
 Website
Comments:
  • The outstanding interest rate of 3.60% versus official base rates at 0.5% does all the talking.......
First Save
Account name :
 Fixed Rate Bonds
Length :
 1 Year
Interest Rate :
 3.60% fixed
Net interest rate :
 2.88% (20% taxpayer)
2.16% (higher rate)
Withdrawal restrictions :
 No withdrawals permitted until maturity
Minimum opening balance :
 £1,000
Misc :
 £1,000 to get your interest paid annually
£5,000 to get your interest paid monthly
More Details :
 Website
Comments:
  • New in this week but who are First Save?
  • They're the UK subsidiary of the First Bank of Nigeria but all deposits are 100% insured by the UK government up to £85,0000
  • It's a shame isn't it when British savers have to rely on Nigerian banks to earn a decent yield, and the City bankers wonder why they're so disliked......
Shawbrook Bank
Account name :
 1 Year Fixed Rate Deposit
Length :
 1 year
Interest Rate :
 3.60% fixed
Net interest rate :
 2.88% (20% taxpayer)
2.16% (higher rate)
Withdrawal restrictions :
 Early withdrawals are not allowed during the term
Minimum opening balance :
 £2,000
Misc :
More Details :
 Website
Comments:
  • Any 1 year deal that pays 3.60% is a good deal but who are the Shawbrook Bank?
  • It's a new UK savings and lending bank and therefore all deposits up to £85,000 are insured by the government
2 Year Savings Bonds
First Save
Account name :
 Fixed Rate Bonds
Length :
 2 Year
Interest Rate :
 3.60% fixed
Net interest rate :
 3.20% (20% taxpayer)
2.40% (higher rate)
Withdrawal restrictions :
 No withdrawals permitted until maturity
Minimum opening balance :
 £1,000
Misc :
 £1,000 to get your interest paid annually
£5,000 to get your interest paid monthly
More Details :
 Website
Comments:
  • New in this week but who are First Save?
  • They're the UK subsidiary of the First Bank of Nigeria but all deposits are 100% insured by the UK government up to £85,0000
  • Personally I don't like any of the 2-year savings bonds as why lock your money up for 2 years and receive 4% when you can get 3.60% on a 1-year deal and your money has greater flexibility
Allied Irish Banks
Account name :
 2 Year Term Deposit Account
Length :
 2 Years
Interest Rate :
 3.90% fixed
Net interest rate :
 3.12% (20% taxpayer)
2.34% (higher rate)
Withdrawal restrictions :
 Early withdrawals are only permitted in exceptional circumstances at the Bank's discretion and are subject to an interest charge
Minimum opening balance :
 £1,000
Misc :
More Details :
 Website
Comments:
  • As above, I don't like any 2-year bond when the 1 year's pay 3.60%
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