Last month’s shocking inflation announcement seems to have reinvigorated competition in the savings market as rates have continued to push upwards. There’s plenty to choose from for those prepared to shop around, although unfortunately still well below inflation at 10.1%. But earning the best rates can help to mitigate the effects of inflation, so earning as much as you can has never been more important.
RATES ARE CORRECT AS AT THE TIME OF PUBLICATION (02/09/2022). All up-to-date rates can be found on our Best Buy tables.
While quiet – there were a couple of significant moves in the Easy Access table this week. It was a bit of a slow start where we actually saw Cynergy Bank withdraw its Online Easy Access Account (Issue 53) paying 1.85% from general sale, leaving it open for existing customers only. However, we then saw Shawbrook Bank launch a new issue of its Easy Access account - Issue 29 paying 1.86%, which at launch slotted into second place behind Al Rayan’s Everyday Saver (Issue 3) which was offering 1.90% AER.
But on Thursday, Gatehouse Bank increased the rate on its Easy Access account for new and existing customers and finally broke into the 2% arena. But Al Rayan was not content to play second fiddle, so quickly increased the rate on Everyday Saver (Issue 3) to 2.10% AER – once again for new and existing savers.
Interesting as we ended the week, Shawbrook launched a new issue of its Easy Access account – this time paying a lower rate of 1.81% AER. This is a new issue (30) so those who opened Issue 29 will still be earning the slightly higher rate of 1.86% AER.
Our Notice Account table has also seen some movement although the leading rate has not increased.
Instead, we now have four providers paying 2.30% - with the top spot currently occupied by DF Capital, who’s account has the shortest notice period of 90 days. OakNorth Bank and Gatehouse Bank are in the joint 2nd spot as they both have 120 Day notice accounts, while last week’s leader, Allica Bank has been pushed into 4th place with its 180-day Notice Savings Account (Issue 1). OakNorth Bank’s 90 Days Notice Deposit Account – Issue 21 takes up the remaining place paying 2.26% AER.
The higher than anticipated rate of inflation for the 12 months to July of 10.1% which was announced last month, has definitely produced another big push upwards of best available fixed term bond rates.
Changes have been plentiful and while it's many of the usual suspects taking up the five spots in each table, rates have increased pretty significantly, in particular in the short-term tables.
We start, as always, by looking at the action in our 1-year fixed rate bond table and what is immediately obvious is that as we end the week, ALL of the entries are paying more than 3.20% - two weeks ago the best rate was 3.05%.
Monument was the first to make a move, leapfrogging all the competition by launching a bond paying 3.20% - but a couple of days later, as we have become accustomed to, Smart Save pipped Monument with a bond paying 3.21%. At the same time, Atom Bank, Shawbrook Bank and the Family Building Society all launched bonds paying higher than the previous top rate of 3.05%, of 3.20%, 3.11% and 3.10% respectively.
Things were not over there as Shawbrook launched yet another bond – this time paying 3.26% - but Tandem was back in the game with a bond paying 3.30% which led the way through the Bank Holiday weekend. As the month of August ended, Investec joined Tandem at the top, also paying 3.30% - a remarkable improvement over such a short space of time. But Ahli United Bank, exclusively via the Raisin cash platform*, blew the competition away with its latest and current issue paying 3.50% - the last time a rate was as high as this was September 2012 – so 10 years ago.
As we have mentioned before, for new customers to Raisin UK there is also a welcome bonus of £30 for a deposit of £10,000 or more for Savings Champion subscribers using our link. If you are eligible for a bonus, you must claim it by emailing [email protected] with the subject 'Raisin UK Bonus' - using the same email address as you used to register. In the email, please add your full name. You can make the claim as soon as you have been notified that your savings account has become active.
This is where the saga of the 1-year bonds ends as we head into the weekend.
The picture is not quite as startling across our 2-year table, although once again the best rates have all increased, albeit in the main by the smallest of margins each time.
It was Monument again who started the activity with a 2-year bond paying 3.46% - a significant improvement on the previous highest rate of 3.36%. But in a mirror image of the activity on the 1-year table, once again Smart Save pipped Monument with a bond paying 3.47%.
JN Bank was the next to sneak past the leader by paying 3.48% but Smart Save fought back and as we end the week, the bank has retained the top spot with its latest issue paying 3.49% AER.
The lead in our 3-year table changed hands changed a couple of times over the last two weeks – with the final play happening at the last minute. First up, JN Bank hit pole position paying 3.45%, holding its ground for a few days until Tandem decided to make a play for the top spot, paying 3.50% AER. Although Close Brothers and Tesco Bank later matched Tandem, it was Smart Save, once again,that pipped the lot by launching the latest issue of its 3-year bond paying 3.51%.
Our 5-year table has been the quietest of the bunch over this two-week period but there is still a new leader with a higher rate. The notable moves came from Close Brothers and, you guessed it, Smart Save! JN Bank and Ford Money joined the 3.50% gang – but Close Brothers was the first to ruffle the 5-year feathers by launching a bond paying 3.60%. However – in order to make it a hat-trick, Smart Save once again took the top spot by the smallest of margins, launching a 5-year bond paying 3.61%.
So, across the fixed rate bond tables the top rates have all increased. How much longer can this continue?
Whilst cash ISAs are little less en vogue at the moment, with many more people likely to exceed their Personal Savings Allowance because of the rise in interest rates, cash ISAs are going to become more and more important.
So, it’s good news that we have still seen some of the usual suspects battling it out recently. That said, even the best cash ISA rates are far below the equivalent bond rates. However, let’s take a look at each of the tables.
Firstly, the 1-year cash ISA table. The first notable move came from the Teachers Building Society, moving to the top of the table paying 2.50% AER. However this was quickly knocked off by UBL launching a new ISA paying 2.51%, which was then matched by OakNorth Bank. Strangely, as the week progressed, OakNorth actually withdraw its 2.51% ISA, launching a new account paying just 2.47%. However, the good news is that as the week ended, UBL UK launched its latest 1-year cash ISA paying 2.55%, so reclaiming what is its preferred place - at the top of the table.
The 2-year table has been far quieter over the last couple of weeks, although we saw a rare appearance from a high street bank! Santander launched a 2-year ISA paying 2.80% which is not far off the best rates available. However, once again one of the stars of the show was UBL UK, which took top spot with its latest 2-year ISA paying 2.87% - but this was then matched by Virgin Money, yet another well-known brand.
Over 3-years it’s been a lot quieter and the best rate available is just 0.02% higher than it was a couple of weeks ago. That said, Teachers Building Society briefly offered a cash ISA paying 3% but was a highlight for just a couple of days.
As the week has ended, UBL UK is in the top spot with its latest 3-year ISA paying 2.92% AER.
Our variable rate cash ISA table has once again perhaps been the quietest of the bunch over the last two weeks, although we have seen the leading rate increase from 1.60% to 1.75% in a last-minute battle.
Paragon launched a new Triple Access Saver (Issue 10) paying 1.65% - but Aldermore increased the rate on its 60 Day Notice Cash ISA Issue 2, to 1.70% - so while not easy access, it did hop to the top.
However, as we end the week, Gatehouse Bank has jumped to the top by increasing the rate on it Easy Access Cash ISA to 1.75% - best paying easy access cash ISA but still considerably less than the 2% the bank is paying on its non ISA Easy Access account!
It's has been good to see best buy rates continuing to improve - keep a close eye on our Best Buy tables for up to the minute information.
*We are occasionally paid by some providers if you click through from our Best Buy Tables and open a savings or current account with them. We will never accept a payment that compromises in any way our independent, whole of market approach to providing information on savings products. For clarity we will indicate those companies who remunerate us with an asterisk (*).
@savingschampion
Find us on Facebook