Fixed rates savings: the gap between the best and the rest widens

Rachel Thrusell, Head of savings at Moneyfacts.co.uk, comments: “Peaking at 7% for only a matter of days, those savers who were not quick off the blocks will have missed out on the very best fixed rate deals. While the best accounts/bonds have remained stable for the last couple of weeks, many of the new issues are being launched with much lower rates, meaning the gap between the best and the rest is widening. With the trend likely to continue across the whole market over time, it may be best to act sooner rather than later before the few remaining good deals slip away too.

“With rate being the key selling point of a fixed rate bond, its surprising to see that 40% pay less than 6%, and 80% pay less than 6.4%, with the average standing at slightly less than 6%. Compare this with a no strings best buy variable rate of 6.40%, and many savers tying up their funds are not receiving a premium to compensate for the lack of access to their money. On the other hand they do have the added benefit that their rates will not fall, if, as predicted, base rate drops.”