Four in 10 people expect no improvement to their personal finances in 2024, according to a survey by AJ Bell.
With rising inflation and increasing living costs, securing the highest interest rates on your savings is more important than ever. Here are some insider tips on how to find the best rates in the UK today.
1. Use Comparison Websites and Tools
Comparison websites are a great starting point to find the best savings rates available. These sites compile data from numerous banks and financial institutions, making it easy to compare and choose the best option for you.
Recommended websites:
- MoneySuperMarket: Offers comprehensive comparisons across various savings products.
- GoCompare: Known for its user-friendly interface and extensive database.
- Which?: Provides detailed reviews and comparisons, helping you make an informed decision.
2. Consider Fixed-Rate Savings Accounts
Fixed-rate savings accounts often offer higher interest rates compared to easy-access accounts. By locking away your money for a set period, you can benefit from these higher rates.
Advantages:
- Higher interest rates: Typically higher than variable-rate accounts.
- Predictability: Know exactly how much interest you’ll earn over the term.
Disadvantages:
- Limited access: You can’t withdraw your money without penalties before the term ends.
Top fixed-rate accounts:
- Charter Savings Bank: Offers competitive rates with various term lengths.
- Shawbrook Bank: Known for its attractive fixed-rate options.
- Atom Bank: An online-only bank with some of the best fixed-rate deals.
3. Explore Online Banks and New Market Entrants
Online banks and new market entrants often provide higher interest rates as they have lower overhead costs compared to traditional banks. These banks are keen to attract new customers and often offer better deals.
Benefits of using online banks:
- Higher interest rates: Due to lower operational costs.
- Convenience: Easy to manage your account through mobile apps.
Prominent online banks:
- Marcus by Goldman Sachs: Offers competitive rates with no fees.
- Monzo: Known for its user-friendly app and high-interest savings pots.
- Starling Bank: Provides competitive rates and excellent customer service.
4. Look Into Government-Backed Savings Options
Government-backed savings options, like those offered by NS&I (National Savings and Investments), can provide competitive rates with added security.
NS&I products:
- Premium Bonds: A chance to win tax-free prizes each month.
- Income Bonds: Offer attractive rates and easy access to your money.
- Direct Saver: Provides a balance of good interest rates and accessibility.
Benefits:
- Security: Backed by the UK government, offering peace of mind.
- Tax advantages: Some products offer tax-free returns.
5. Regularly Review and Switch Accounts
Interest rates can fluctuate, so it’s essential to regularly review your savings accounts and switch when better rates become available. Staying proactive can ensure you’re always getting the best return on your savings.
Tips for switching accounts:
- Set reminders: Review your accounts annually or when your fixed term ends.
- Stay informed: Follow financial news and updates on interest rate changes.
- Use switching services: Some banks offer easy switching services to help you move your savings hassle-free.
Conclusion
Finding the highest interest rates for your savings requires a bit of research and vigilance, but the rewards are well worth the effort. By leveraging comparison websites, considering fixed-rate accounts, exploring online banks, utilising government-backed options, and regularly reviewing your accounts, you can maximise your savings and ensure your money works harder for you.
