Lenders have been quietly cutting savings rates during the holidays following the string of Bank of England base rate cuts, leaving some consumers with accounts paying as little as 0.1 per cent.
The cut in savings rates has particularly affected pensioners who depend on interest payments to supplement their savings for retirement but it is affecting anyone who has cash on deposit.
Savers are being urged to review the rate they are receiving and compare it to the rest of the market.
ONLINE GUIDE TO SOME OF THE BEST DEALS
Fixed-rate bonds
If you’re able to lock your money away for at least a year then you will be able to take advantage of rates of more than 5 per cent.
Financial data provider Moneyfacts.co.uk cites ICICI Bank UK’s HiSAVE Fixed Rate account paying 5.10 per cent on it’s 12 month bond, but savers will need a deposit of £1000.
Anglo Irish Bank has a one-year bond paying 5 per cent on a minimum deposit of £500. This bank is backed by the Irish government’s 100 per cent deposit guarantee.
If you only want to tie your money up for six months then Chelsea Building Society has a Short Term Winter Fixed Rate paying 4.5 per cent with a deposit of £1,000.
Easy access accounts
There are still a few deals for savers that need access to their spare cash. Anglo Irish Bank is paying 4.55 per cent on its Deposit Issue 2 account and savers need just £1 deposit.
Other decent rates include Scarborough Building Society’s Balance Buildler Issue 1 account is paying 4 per cent on a £1 deposit.
The Bonus Guarantee account at Stroud & Swindon Building Society offers 3.75 per cent for savers with a £500 deposit.
If you have at least £5,000 to deposit as a lump sum, you could consider Tesco Savings account which is paying 3.75 per cent
Regular savings accounts
There are a few attractive accounts remaining if you’re able to put away a monthly sum but as always in life, there are catches so you will need to read the small print first.
Abbey is paying 5 per cent on monthly deposits from £20 to £250, while Principality Building Society is paying 6 per cent on deposits from £20 to £500.
Barclays Bank is paying 5.84 per cent on monthly deposits of between £20 and £250.
Skipton Building Society has a Special Saver paying 4.45 per cent on monthly deposits of £10 to £250. Skipton is also still offering a Christmas Saver Issue 3 paying 4.45 per cent on deposits of £10 to £250.
Cash Isas
The best way to avoid paying tax on your savings is to put your money into an individual savings account. Moneyfacts cites the Newcastle Building Society account as paying one of the highest rates for a cash Isa. Its Isa Issue 2 pays 4.50 per cent but you have to deposit the full £3,600 into the Isa and that includes a 0.5 per cent bonus until July. The Newcastle Builiding Society Reward Saver Isa pays 4.5 per cent inlcuding a 1 per cent bonus for 12 months.
Alternatively Kent Reliance Building Society offers 4.4 per cent and Birmingham Midshires is paying 4 per cent.
Source: Moneyfacts.co.uk
