It’s not a big secret that rates on savings accounts are slowly decreasing.
Last year, savings accounts were on a high with rates above 6% on some fixed-rate accounts. But this couldn’t last forever, as the economic climate changed. Inflation fell to 3.9% in November and the Bank of England continued to freeze the base rate at 5.25%.
These factors impacted savings rates, and we’ve seen the average monthly rate for savings accounts drop to 4.1% in January compared to 4.6% in September, 2023.
Looking at the savings account market for all customers, the top interest rate for an easy access account stands at 5.22% with Metro Bank’s instant access savings account. Whereas for fixed-rate accounts, Investec has a one-year fixed-rate saver at 5.30%.
These rates are definitely still competitive and will help savers to earn some extra money on their cash. However, if you are keen to find the top rates, then you might need to look closer to home.
Big banks like Nationwide, First Direct and TSB are all offering savings accounts with an interest rate at 6% or above.
But, there’s a catch. These accounts are for existing customers only or for people that decide to switch their current account. Alongside attractive switching offers, banks are also trying to get more customers by offering these higher rate linked savings accounts.
For example, TSB is currently offering a switching offer of up to £185* with its Spend & Save account. This is an everyday current account with optional features and no account fee. The switching offer allows a customer to earn £125 when they apply for a Spend & Save or Spend & Save Plus account, and there’s an opportunity for up to £60 in double cashback. Remember to read all the terms and conditions before making the switch.
The good news is that TSB customers will then get access to its monthly saver account. This has an interest rate of 6% which is fixed for one year. You’ll be able to save between £25 and £250 each month via a standing order and there are no withdrawal charges.
Similarly, First Direct is offering a switching offer of £175* cashback when someone switches to its 1st Account and deposits £1,000 into the account. This current account then unlocks access to a 7% regular savings account. This interest rate is fixed for 12 months and you can save between £25 and £300 a month into the account. The regular saver is also flexible as you can change the amount you deposit at any time, which works well for different budgeting demands. Plus, although you are restricted with how much you can save each month, the interest adds up - if you save £300 every month for 12 months at this rate, you’ll earn around £136.50 in interest.
Elsewhere, Nationwide has gone one step further, as it is offering its current account members a Flex Regular Saver with an interest rate of 8%. Bear in mind that this rate is variable, so it could change throughout the year. This regular saver also has some restrictions as you can only save up to £200 a month, and there are only three withdrawals allowed during the year before the interest drops to 2.15%. But, if you stick to the rules, this regular saver will certainly maximise the interest on your savings.
Overall, the accounts mentioned above show there are still some good offers within the savings account market, but you’ll need to do your research to get the best deal. Plus, there’s never been a better time to save little and often, as this is where the high interest rates can be found.
*Ts and Cs apply
FAQs
Currently, there's only two accounts that pay 6% APY — Digital Federal Credit Union's savings account and Boeing Employees' Credit Union's savings account — and they only pay 6.17% APY on a small portion of your balance. The rest of your balance will earn a comparatively low APY.
How can I get 7% interest on my money? ›
7% Interest Savings Accounts: What You Need To Know
- As of September 2024, no banks are offering 7% interest rates on savings accounts.
- Two credit unions offer high-interest checking accounts: Landmark Credit Union Premium Checking with a 7.50% APY and OnPath Credit Union High Yield Checking with a 7.00% APY.
Big banks like Nationwide, First Direct and TSB are all offering savings accounts with an interest rate at 6% or above.
How do I get 10% interest on my money? ›
Where can I get 10 percent return on investment?
- Invest in stocks for the short term. ...
- Real estate. ...
- Investing in fine art. ...
- Starting your own business. ...
- Investing in wine. ...
- Peer-to-peer lending. ...
- Invest in REITs. ...
- Invest in gold, silver, and other precious metals.
Existing-customer regular savers – what we'd go for
| Provider | Rate (AER) | Can you skip months? |
|---|
| First Direct | 7% fixed for one year | No, min £25/month |
| Co-operative Bank | 7% variable for one year | Yes |
| HSBC | 7% fixed for one year | No, min £25/month |
| Skipton BS (must have been a member since before 11 Jan 2024) | 7% fixed for one year | Yes |
12 more rowsDigital Federal Credit Union, abbreviated DCU, offers a no-strings-attached Primary Savings account that earns you as much as 6.17% APY on the first $1,000 in your account. There are no monthly fees or minimums to earn, making this the perfect account for your emergency fund.
Which bank gives 7% interest on savings accounts in the USA? ›
A 7% interest savings account is hard to come by. The only institution we found offering such a high rate is Landmark Credit Union.
Can you get 6% on a CD? ›
There are two credit unions paying 6% APY on a CD: Financial Partners Credit Union and Geismar Complex Federal Credit Union. You'll have to meet certain eligibility requirements to join each of these credit unions, though. Why do some banks offer much higher CD rates than others?
Which bank gives 8% interest? ›
Some banks offer interest rates of 8% or more, making them an appealing option for risk-averse investors. For instance, Unity Small Finance Bank offers 9% interest for 1,001 days, while YES Bank offers 8% for 18 months.
Which bank gives 6% on savings accounts? ›
The DCU Primary Savings offers a standout 6.17% APY, but only up to $1,000 — meaning savers bank nearly $62 in a year.
Whether you're starting a family, buying a house or launching a business, savings continues to be essential in your 30s. Saving upward of $800 each month can sound like a daunting task, but consistency is key as you work toward any savings goal.
Should you have $100 000 in savings? ›
A $100,000 savings account balance is fine if it aligns with your goals. But it could be a red flag if you don't need that much money there. Some people put all their extra money in their savings accounts because they feel as if it's the safest option. They'd rather do that than take on any risk.
Where to put $10,000 for best interest? ›
For higher returns, an attractive investment for £10,000 could be shares or equity funds (which are made up of shares). You could invest in a tracker fund that mimics the performance of stocks listed on the FTSE 100, which is a low-cost way of investing in shares. Remember shares are higher risk than bonds.
What bank gives the highest interest rate? ›
Best High-Yield Savings Account Rates for September 2024
- Pibank – 5.50% APY.
- Poppy Bank – 5.50% APY.
- Western Alliance Bank – 5.31% APY.
- Forbright Bank – 5.30% APY.
- Vio Bank – 5.30% APY.
- BrioDirect – 5.30% APY.
- Ivy Bank – 5.30% APY.
- TotalBank – 5.26% APY.
According to data from the FDIC, the average savings account earns 0.46% APY. Currently, however, the best high-yield savings accounts offer APYs of around 5.00%. If you deposit $10,000 into one of these high-yield savings accounts, you'll earn $500 in interest in a year.
Are any banks paying 6% interest? ›
There isn't a nationwide bank offering a 6% CD rate today, but there are three local credit unions with CDs that pay 6% APY (although you'll need to meet membership eligibility requirements). California Coast Credit Union also has a 5-month Celebration Certificate with a 9.50% APY.
Who gives 6% interest? ›
However, there are a growing number of providers paying 6%-plus to those willing and able to tie up some savings cash for a year, including FirstSave, Atom Bank and Monument Bank. A number of two- and three-year fixed-rate savings bonds also pay 6%-plus. NS&I has also been upping its fixed rates.
Which bank gives 6% interest rate? ›
Savings Account - Apply for Savings Account with 6% Interest Rate - Kotak Bank.
How long will it take to double $1000 at 6% interest? ›
So, if the interest rate is 6%, you would divide 72 by 6 to get 12. This means that the investment will take about 12 years to double with a 6% fixed annual interest rate.
