Here are my top places to put your cash.
We’re a long way now from when we could get 5%, with rates slowly dropping over the last few years. And following the Bank of England base interest rate cut to an all-time low of 0.1%. those cuts have happened even faster. Accounts can disappear days after becoming available, and rates continue to fall.
You want to make sure you’re getting the best rate on your savings, and this article will take you through the best options right now.
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Latest inflation rate
Though it’s not always possible at the moment, your aim should be to ensure you earn more on your savings account than the current rate of inflation. This really is key as anything below that rate is losing value in real terms,
The latest inflation rate (for March 2021) was 0.7% which means it’s hard to get accounts that beat it. But if you look at this chart you’ll see the current climate makes it very unpredictable.
source: tradingeconomics.com
My latest savings update
Every month on my YouTube channel I take you through the latest savings news and chat about some of the accounts featured on this page. Here’s my monthly video roundup from early May 2021
(This article is updated regularly but check the published date to see when this last happened. New videos are usually at the start of the month.)
Best Regular Savings accounts – up to 3.04%
These accounts are all “Regular” or monthly savers which work differently to normal saving accounts.
For a start, there’s a limit to how much you can save each month, and the interest is calculated on the balance each month. After 12 months the interest is paid and your saver closed. But you can then open up another and begin again.
These are ideal if you only have a certain amount of money to put aside each month, or to move money every month from a lower-paying easy access account. Here’s my full guide to how they work.
You can only open the top accounts if you have or open a current account with these banks – but that’s no reason to put you off.
Sadly the market leading accounts from First Direct, HSBC and M&S Bank all cut rates for new customers to 1% in late November 2020.
Natwest / RBS (3.04%)
| Account name | Digital Regular Saver |
| Interest rate | 3.04% AER (variable) |
| Max monthly deposit | £50 |
| Min monthly deposit | £1 |
| Max amount earn interest on | £1,000 |
| Account closes | No |
| Withdrawals | Easy access with no penalty |
| Requirements | Must have a Natwest or RBS current account |
This account offers a massive rate but with a few restrictions. The biggest is you can only save £50 every month. Not far behind is that interest will only be paid on the first £1,000 saved.
It’s only open to Natwest or RBS customers – though you can have one at each bank. Here’s my review of the account and more information on how it works.
Coventry Building Society (1.05%)
| Account name | Regular Saver |
| Interest rate | 1.05% AER (variable) |
| Max monthly deposit | £500 |
| Min monthly deposit | £0 |
| Max amount earn interest on | £1,000 |
| Account closes | After 12 months |
| Withdrawals | 30 days interest penalty for early withdrawals |
| Requirements | None |
This regular saver from Coventry Building Society doesn’t require a current account so anyone can open it. The rate is variable so it can change at any time (and dropped mid-Feb from 1.3%). You can however pay in a decent £500 a month.
Other monthly savers (1%)
These accounts are only open to current account customers. Though a long way from their previous high rates, they are still among the highest paying. However, I wouldn’t bother opening one of these specifically to access the monthly savers.
- Club Lloyds Monthly Saver (1% fixed) – up to £400 a month
- First Direct Regular Saver (1% fixed) – up to £300 a month
- HSBC Regular Saver (1% fixed) – up to £250 a month
- Nationwide Start to Save (1% variable and quarterly prize draw) – up to £100 a month
- TSB Monthly Saver (1% fixed) – Up to £250 a month
There are also these accounts which don’t require a current account. Ecology BS is a decent ethical option.
- Ecology Building Society (0.8% variable) – up to £250 a month
- Halifax Regular Saver (0.75% fixed) – up to £250 a month
Best high-interest current accounts – up to 2.02%
Some of the next best rates are in current accounts. All of these accounts can be opened by anyone, though you will be credit checked. You can access your money at any time, however, the amount of money you can earn interest on is limited.
Virgin Money M Plus (2.02%)
| Account name | M Plus Current Account |
| Interest rate | 2.02% AER (variable) |
| Max savings interest paid on | £1,000 |
| Withdrawals | Easy access |
| Multiple accounts | Yes |
| Requirements | Online only |
This account from Virgin Money will pay 2.02% on up to £1,000. You can also have more than one account and earn interest on the money there too. There’s no limit to how many you can have, though of course Virgin Money doesn’t have to accept you for each new application.
You can also get a linked 0.35% savings account which isn’t too much lower than the best easy access accounts (more on these below).
If you switch into a new M Plus account you can also get a switching bonus consisting of 12 bottles of wine and a £50 charity donation. More details in my full review of this Virgin Money current account.
Nationwide FlexDirect (2%)
| Account name | FlexDirect Current Account |
| Interest rate | 2% AER (fixed for one year) |
| 0.25% AER (variable after year one) | |
| Max savings interest paid on | £1,500 |
| Withdrawals | Easy access |
| Multiple accounts | Yes (one personal and one joint) |
| Requirements | None |
You can get 2% for one year on a balance of up to £1,500 with the FlexDirect account. You do need to pay in £1,000 a month to account in order to get this rate.
After the first year it will drop to 0.25%, but you can always switch away when that happens (and hopefully get a nice cash bonus for doing so).
It’s worth noting that you only get this interest rate when you first open the account. This means if Nationwide were to bring back referral offers or increase the rate you’d miss out. On that basis I’d say give this account a miss for now as you’re not missing out too much. Here’s more in my full review of the FlexDirect account.
You’re able to get the 2% on both a solo account and a joint account, so it’s worth opening a joint account too if you’re in a relationship (though watch this video first).
You can also open a 1% monthly savings account.
Halifax Reward (1.2% equivalent)
| Account name | Reward current account |
| Interest rate | 1.2% AER equivalent |
| Max savings interest paid on | £5,000 |
| Withdrawals | Easy access |
| Multiple accounts | No |
| Requirements | £5,000 must stay in the account every day of the month |
| Pay in £1,500 a month to the account |
The Halifax Reward account gives account holders get £5 a month as a “reward”. There are two ways to get this.
One is spending £500 on your debit card, or you can get if there is £5,000 in your account every day of the month.
If you do this every day of the year, you’ll get £60, which though it’s not interest, is the equivalent of 1.2%.
However, have less in the account for just one day of a month and you get nothing. And £5k is a lot of money for most people, especially as you can get better rates elsewhere
So it’s better to use the debit card option and see it as cashback rather than a savings option. Here’s my rundown of how this Rewards account works.
Club Lloyds (0.78% equivalent)
| Account name | Club Lloyds current account |
| Interest rate | 0.6% AER (£0.01 to £3,999) |
| 1.5% AER (£4,000 to £5,000) | |
| Max savings interest paid on | £5,000 |
| Withdrawals | Easy access |
| Multiple accounts | Yes (one personal and one joint) |
| Requirements | Pay in £1,500 a month to the account |
| Pay out two Direct Debits each month |
With all the recent rate cuts, this current account has suddenly become a lot more appealing for savings. As long as you have two direct debits going out, you’ll get 0.6% on balances up to £3,999 and then 1.5% between £4,000 and £5,000. So that’s the equivalent to 0.78% if you have the full £5.000 saved.
You also get access to the above mentioned 1% regular saver, and there are freebies with the account such as monthly movie rentals or a magazine subscription. Make sure you pay in £1,500 a month to avoid a £3 monthly fee. Here’s my review.
Best app based savings – up to 1.25%
There are more and more ways to earn interest, including apps.
Chip +1 (1.25%)
| Account name | Chip+1 |
| Interest rate | 1.25% |
| Fee | Free to save under £2,000 / £1.50 every 28 days to earn on savings above £2,000 |
| Max savings interest paid on | £10,000 |
| Withdrawals | Easy access |
| Multiple accounts | No |
| Requirements | Can only open with VIP invite code (BCLEVER21) |
| Pay out two Direct Debits each month |
This is an easy-access account but with a few differences. For a start you’ll only earn the interest on the first £10,000 and you won’t earn compound interest.
Plus there’s a fee on top if you want to save between £2,000 and £10,000, which reduces the rate you’ll earn in real terms. If you have the full £10,000 saved it works out as 1.06%.
But all in it’s a decent bet. Here’s my full review, including the VIP invite code you’ll need to access the account.
There’s also an extra £10 welcome bonus running until 22 May – details below
Bonus £10 with Chip+1
You can also get a bonus £10 if you open a Chip+1 account before 22 May 2021 with the VIP code CLEVER10.
To qualify you also need to sign up to the ChipAI subscription (£1.50 every 28 days) and stay on it until at least 8th July 2021.
You should get the first month free, meaning if you open the account after 15 May and cancel on 9 July you’ll pay a total of £1.50.
The £10 bonus will be paid by 22 July 2021.
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Get a £17 Quidco bonus (new members only). More details
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+ Get a £17 Quidco bonus (new members only). More details
Best fixed savings accounts – up to 0.85%
The above accounts all have caps on how much you can save, though a mix of some or all of them would cover a large chunk of the money you’d need in cash savings. You could also look at Premium Bonds.
But what should you do with any additional money? You can still beat most standard savings or current accounts where you’re likely to get less than the base rate of 0.1%.
You can also fix your savings for a year or longer and get a slightly better rate in return. However, you need to be sure you won’t need access to that cash over that time. The longer you fix, the greater the risk you’ll lose out if rates were to rise. But at the same time, they’re protected if rates were to continue to fall.
- Atom Bank (0.85% AER) – one year fix (min £50 / max £100,000)
- Shawbrook Bank (0.75% AER) – one year fix (min £1,000 / max £2m)
- Atom Bank (0.5% AER) – six month fix (min £50 / max £100,000)
Best notice account – 0.67%
A notice account means you have to request to get your money and interest, which will be released after a set time. They often have a variable rate but if there’s a cut you’ll normally have notice.
- Charter Savings Bank (0.67%) – 120-day notice (min £5,000, max £1m)
- Charter Savings Bank (0.65%) – 95-day notice (min £5,000, max £1m)
- Moneybox (0.5% AER) – 95-day notice (min £1 / max £85,000)
- Moneybox (0.45% AER) – 45-day notice (min £1 / max £85,000)
Best easy access savings accounts – up to 0.5%
Rates are incredibly poor for these accounts and getting worse!
- Atom Bank (0.5% AER variable) (min £0 / max £100,000)
- Marcus (0.4% AER variable) (min £1 / max £250,000)
- Tandem (0.4% AER variable) (min £1 / max £TBC)
Best Cash ISA – up to 0.45%
Though most of us don’t need the tax-free “wrapper” offered by an ISA, if you are wanting to use one then the same goes in terms of finding the best rate.
You can’t pay in more than £20,000 each financial year into any combination if ISAs, and you can only pay money into one Cash ISA.
Flexible ISAs allow you to withdraw money and pay it back in without impacting your annual allowance. Look for ones that allow transfers in if you have money from previous tax years you want to move.
- Kent Reliance (0.45% AER variable) – transfers in allowed / not flexible
Premium Bonds
Read my article looking at how Premium Bonds compare to other savings accounts.
Broadly, if you have £10,000 saved you’ll likely win £75 in a year, the equivalent to 0.75%, increasing to above 0.9% the more saved.
Best children’s savings account
I’ve written in more detail about the different savings accounts for kids, so do check that article out.
Halifax Kids’ Monthly Saver (3.5%)
You can save between £10 and £100 a month into this regular saver with Halifax and earn 3.5% AER (Fixed) for 12 months.
Various Building Society Junior ISA (2.5%)
The best rate on a Junior ISA is with Bath BS or Darlington BS.
HSBC MySavings (2.5%)
The MySavings account from HSBC pays 2.5% AER (variable) on up to £3,000 saved. Above this amount you’ll only get 0.25%. There’s a minimum deposit of £10.
Best ethical savings account
The money you hold in your savings is used by the banks to invest and lend money. This could mean it’s used for things you might disagree with, such as fracking, tobacco or arms manufacturing.
There are banks with ethical policies such as Triodos, while building societies must lend 75% of their funds to home buyers, meaning they don’t have the cash to invest elsewhere. Sharia accounts can’t be used for things against Islamic law, like tobacco or gambling.
Nationwide FlexDirect (Current account) – 2%
This current account gives 2% on up to £1,500. It’s fixed for one year. You can also open the 1% Start to Save regular saver. Read more about these above.
Ecology Building Society (Regular saver) – 0.8%
This is a variable rate regular saver from Ecology paying 0.8% with a minimum of £25 and maximum of £250 a month.
Al Rayan Bank (one year fix) – 0.55%
The expected return on this Sharia account is 0.55% with Al Rayan Bank, with a minimum deposit of at least £5,000. No early withdrawals permitted.
Tandem (easy access) – 0.4%
This Green Instant Access Saver offers 0.4% from Tandem. The bank says it will support green lending initiatives. You can only open it via the Tandem app.
Best Sharia accounts – up to 0.55%
Paying interest isn’t allowed in Islam, so a Sharia-compliant savings account instead promises a return on the money saved – an expected profit rate. Though technically this means the rate isn’t guaranteed, it’s not happened yet. They’re open to everyone, not just Muslims.
Al Rayan Bank (one year fix) – 0.55%
The expected return on this Sharia account is 0.55% with Al Rayan Bank, with a minimum deposit at least £5,000. No early withdrawals permitted.
Finding the latest savings rates
I’ll update this page regularly (check the published date to see when it last happened), but if you find a rate has been cut or isn’t available, you can check the Savers Friend website.
Andy,
I have £30K I would like to place in a savings account, with the ability to access it if required. I wouldn’t mind “locking it in” an account for 18 months if a decent fixed rate was available. I am not interested in any middle east based bank.
I have no mortgage or debt
Can you suggest anything?
If you go on the ONS website the rate of inflation for December was 0.8% as 0.6% was Decembers rate.
https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/december2020
Sorry 0.6% was November’s
That’s the CPIH rate which was at 0.8% in December, whereas the standard rate people use is CPI which was 0.6%. It’s very, very easy to get confused.
I opened an account with Marcus earlier this year who had the market-leading rate but it seems every time I check my account I have a notification saying the interest rate will be dropping! Might change over to Chip, thanks for researching this roundup.
I think it’s misleading to say you can earn 2.75% on the regular saving accounts. Because of the way you drip-feed into these accounts, the actual rate is about 1.49%pa.
Hey JC. The 2.75% rate is based on a year. So if there’s £250 in on month one, that will earn the full rate for a year. Then the next month you add £250, that’ll only be in the account for 11 months, so will get 11/12 of the 2.75% interest. And so on. But that’s still more than having that money in a lesser paying account.
A few people have got confused on this too so I’ll add an article on these to the to-do list.
Totally agree! Ethically providers should make the real rate unequivocally clear – but that does’nt draw in the punters.
lt’s known as ‘sucker bait’. Almost everyone knows except the likes of the Financial Conduct mob – but they were always toothless tigers. Providers don’t realise Good ethics is good business = good profits. Boards of Directors generally in Office for short terms so take short term fast buck views.
Obtaining the Halifax switching offer is committing to a three year contract with direct debits etc so subsequent switching is a no no. I would appreciate your comments
Hi Keith. Where are you getting this form? There’s no commitment to stay when you switch. Andy
My Flexdirect interest rate has dropped off as it has been 12 months and I am not able to speak with anyone at nationwide on the phone or online “due to coronavirus”.
Do you know if it is possible to renew theaccount at this rate?
Thanks!
Hi Sonia, afraid not – unless you open up a joint account and you can get the rate for a year again (but sadly just 2% now)
I think Halifax reg saver is only 1.5% now, no longer 2%. Fixed rate though.
Thanks Scooter. Will update
Only 1% now (Feb 2021)
Try Money saving expert website (Martin Lewis)
Yes, a good choice of accounts there. They use the same Moneyfacts website to check the different rates (I should know as I did that when I worked there!)
I’ve opened a Llyods, First Direct, Halifax and Coventry Build Society accounts and maxed out on all each month. Still looking for other accounts to open. I did notice my credit rating dropped for 2months but its now gone back up to 999.
My 5% regular saver will end in May 2020. If I take out another it would be at 2.75 percent. I find it annoying banks are reducing interest rates.I would like to get a budget that works perfectly. I think I am spending more on groceries because of the lock down. I like a regular saver because it is perfect unlike my budgeting for groceries.
Checked the Halifax Regular Saver account. It would seem you only get the 2% for the first 12 months and not after the first 12 months as you state’
Yes that’s right, you get paid the 2% after the 12 month period.
Hi Andy
I’m looking to invest £5000 for about 5 years or so. Have you any advice for where to put my money. Is it a good time to invest in stocks and shares seen as though they tumbled last week?
Hi John, investing isn’t my area of expertise so it’s not really one I can answer. Sorry!
Anything about ISA savers account?
Hi Bil,
So with something called the personal savings allowance you can now earn £1,000 in interest tax-free (basic rate taxpayers) or £500 (Higher rate taxpayers). You’ll need a lot of cash saved up to go above this, which means for most people ISAs aren’t relevant. Better to go for the best rate you can find, whether an ISA or not.
You are still mentioning 5% at TSB, and a regular saver at Nationwide – as far as I am aware this is not longer the case
Ah, yes this article was from earlier the year. Will refresh it. Thanks
What about the supermarkets X’mas savings schemes? Or are they outside the scope of your article? Asda & lceland had schemes last year & seemingly gave good returns on the amounts saved. No doubt Ts & Cs apply.
Andy you missed Yorkshire building society. 3.5% regular saver
Hi Andy, I found an article mentionning that Nationwide https://www.google.co.uk/amp/s/www.thisismoney.co.uk/money/saving/article-9367401/amp/Best-savings-rates-Nationwide-pays-1-cash-Isa.html offers a £50 bonus to existing customers who switch their ISA. Do you happen to know if its still available ? I found nothing on their website. Thank you for your guidance and the good work.