The latest news to help you get the most from your savings account.
Here’s my monthly update sharing changes at leading UK savings accounts, as well as some of the articles you might have missed on the blog.
July’s savings update video
July’s savings news
Inflation stays flat & base rate up to 5%
Inflation still remains high – much higher than almost all savings accounts out there. It was expected to fall, but it has stayed at 8.7%. And the “core inflation” figure (when you remove food and energy prices) actually went up.
As a result the base rate increased from 4.5% to 5% (a larger jump than predicted), and the markets are now expecting rates to increase to around 6% by the end of this year. A lot of the increase below are pricing in this change.
Best rates improve across most account types
This table shows the increases on the best paying accounts at the time of writing, compared to my update last month.
|Account type||Best rate 4 July 2023||Best rate 1 June 2023||Change in percentage points|
|Open to all||6%||5.5%||+0.5%|
|6 month fix||5.34%||4.66%||+0.68%|
|9 month fix||5.29%||4.85%||+0.44%|
|12 month fix||6.05%||5.25%||+0.8%|
|18 month fix||6%||5.09%||+0.91%|
|2 year fix||6.05%||5.25%||+0.8%|
|3 year fix||5.98%||5.3%||+0.68%|
|4 year fix||5.75%||5.05%||+0.7%|
|5 year fix||5.7%||5.35%||+0.35%|
|Easy access ISA||4%||3.75%||+0.25%|
|1 year fix ISA||5.21%||4.51%||+0.7%|
|2 year fix ISA||5.25%||4.55%||+0.7%|
Easy Access rates up again to 4.35%
You can get 4.35% from Family Building Society and 4.25% from Yorkshire Building Society, both great options.
Just below them is Chip at 4.21%. Don’t be surprised if the rate on this improves shortly if more providers nudge above it.
If you’ve got existing savings paying less than 4% (if not a little higher), then I’d be looking to move that money elsewhere.
This could mean ditching those who did increase their rates following the base rate hike – but just not enough. That includes the likes of Atom (3.95%), Zopa (3.92%), Chase (3.8%) and Marcus (3.7%). Those of you who got the Santander e-saver a while back should also ditch it (now 3.75%).
Banks that tend to offer more competitive increases to savings rates after a base rate hike (though this is never guaranteed), include Kroo (4.1%) and Tandem (4.1%). They’re not at the top, but they’re not far behind.
With all providers, you’ll want to check that you’re getting an improved rate. Cynergy Bank for example doesn’t pass this on automatically. You’ll need to open up a “new issue” of the account and transfer your money (and interest) over.
These rates can all still be beaten by the slightly complicated Barclays Blue Rewards Rainy Day Saver which pays 5.12% on the first £5,000. However if we keep seeing improvements elsewhere, it could soon be time to ditch this one for a simpler option.
Also, while we’re talking about current account linked savings accounts, don’t bother with the Santander Edge Up (which replaces the 123). The 4% rate on up to £50,000 sounds good but there’s a £5 monthly fee to consider. It’s only worth it if you don’t already have an account that pays cashback on bills.
Easy access picks as of 5/7/23
A longer list of accounts is available here. The leading options are below:
- Barclays Blue Rewards (5.12% AER variable): min £1 / max £5,000 (requires current account with Blue Rewards add-on)
- Family Building Society Online Saver (4.35% AER variable) : min £100 / max £250,000
- Chip (4.26% AER variable): min £1 / max £250,000Earn up to £50 bonus – details here
- Ford Money (4.25% AER variable): min £1 / max £2m
- Yorkshire Building Society Internet Saver Plus (4.25% AER variable): min £1 / max £500,000
- Investec (4.2% AER variable): min £5,000 / max £250,000
- Leeds Building Society (4.2% AER variable): min £1,000 / max £1m
- Monument Bank (4.2% AER variable): min £25,000 / max £400,000
- RCI Freedom Savings Account (4.2% AER variable): min £100 / max £250,000
As ever, these could well change again in the coming days, so check out my best buys guide for updates.
Limited access picks as of 5/7/23
The Hanley Building Society account I wrote about last month was pulled, so this is one of the few account types where the best paying account is less this time around.
Some notable new additions include 4% from HSBC or First Direct on up to £50,000, reducing to 1.75% in months where you make a withdrawal. You need to be an existing customer, but they’re decent rates from well known names.
The top accounts this month include:
- Yorkshire Building Society Rainy Day Saver (4.35% AER on balances up to £5,000 / 3.70% on balances over £5,000): min £1 / max £500,000 two withdrawals a year
- Coventry Building Society Limited access account (4.3% AER variable from 7 July, 3.55% until then): min £1 / max £250,000 six withdrawals a year
- Principality Building Society Online double access saver (4.3% AER variable): min £1 / max £1m two withdrawals a year
- Paragon Triple access account (4.25% AER variable): min £1 / max £500,000 Three withdrawals a year
- First Direct Bonus Saver(4% AER variable): min £1 / max £50,000
- rate reduces to 1.75% in months you make a withdrawal
- requires a current account with First Direct
- HSBC Online bonus (4% AER variable): min £1 / max £50,000
- rate reduces to 1.75% in months you make a withdrawal
- requires a current or other savings account with HSBC
Notice accounts picks as of 4/7/23
Improvements on 90 and 120 days again this month.
- Tipton & Coseley Building Society (4.85% AER) 120-day notice: min £100/ max £100,000
- BLME (5.09% expected profit rate variable): 90-days notice: min £20,000 / max £1m
Loyalty regular savers reach 9.5%
Wow, a huge increase to regular savers this month. But sadly the inflation beating figure of 9.5% isn’t as good as it first appears.
It’s only for Saffron Building Society customers who had an account in June last year. And the most you can add is £50 a month. Slightly better is a 7.5% rate from Skipton BS that allows up to £250 a month, though you’ll need to have been a customer before the end of May this year.
The only other significant change is a new account from Beehive Money. You can get 6% and a monthly limit of £250 without the need to have a current account with the bank.
I’ve also created a new dedicated Regular Saver best buy article, so you can see further details and more rates there.
Regular Saver accounts picks as of 4/7/23
- Saffron Building Society Member’s Regular Saver (9% AER fixed) – min £1 / max £50 a month (requires BS membership on or before 1 June 2022)
- Skipton Building Society Member Regular Saver (7.5% AER fixed) – min £0 / max £250 a month (requires BS membership on or before 31 May 2023)
- First Direct (7% AER variable) – min £25 / max £300 (requires current account)
- Club Lloyds (6.25% AER fixed) – min £50 / max £400 (requires current account)
- Natwest or RBS (6.17% AER variable) – min £1 / max £150 (requires current account)
- Beehive Money Regular Saver (6% AER fixed) – min £10 / max £250 a month
Fixed rates go past 6%
Amazingly you can get more than 6% on some fixed rate accounts right now. SIX. There’s a lot of movement here, and it’s hard to say whether it’ll go up more, or whether its already peake.
Until today the top rate was 6.1% on a 2-year fix, while longer fixes have only just dropped below 6%. If you have the money available to lock away it might make sense to move fast.
Remember, most fixed rate accounts will pay all the interest at the end of the term, so the longer fixes will very likely take you over your personal savings allowance, meaning you’ll be subject to tax on the excess.
Here are the leading options right now. Make sure you keep an eye on my best buy list for all the options.
Fixed savings accounts picks as of 5/7/23
- 6 months Allica Bank (5.34% AER fixed): min £10,000 / max £250,000
- 9 months Atom (5.4% AER fixed): min £50 / max £100,000
- 12 months FirstSave (6.1% AER fixed) : min £1,000 / max £2m
- 15 months Cynergy Bank (5.91% AER fixed): min £1,000 / max £1m
- 18 months BLME (6% expected profit rate fixed): min £1,000 / £1m
- 2 years FirstSave (6.15% AER fixed) : min £1,000 / max £2m
- 3 years Castle Community Bank via My Community Finance (5.98% AER fixed) 3-year-fix: min £1,000 / max £85,000
- 4 years Cynergy Bank (5.75% AER fixed): 4-year fix min £1,000 / max £1m
- 5 years Hampshire Trust Bank (5.75% AER fixed): min £1 / max £250,000
Premium Bonds hike twice to 4%
There have been two Premium Bond increases since my last update. First, the prize rate for the July draw moved from 3.3% to 3.7%, and it’ll ove again to 4% for the August draw.
The latest change improves the odds from 24,000:1 to 22,000:1, which means you’ve a better chance of winning, along with the likelihood you’ll win a bigger prize if you do get something. I’ve written in more detail about the change here.
ISAs pass 5%
For those of you who need the tax-free earnings offered by ISAs, there’s been improvement on rates again this month.
Though they’re still well below the non-ISA accounts, rates are worth looking at. The top easy access ISA is now 4%, while a limited access one is available for 4.1%.
The base rate hike is also reflected at the top of some fixed rates accounts, with Castle Trust moving from 4.25% to 4.51% for a one-year fix.
ISA picks as of 4/7/23
- Easy access Gatehouse (4% expected profit rate): min £1,000 Transfers in
- Limited access Coventry Building Society (4.1% AER variable from 7 July 2023): min £1 Flexible/Transfers in
- 1 year Coventry Building Society (5.3% AER fixed) Transfers in
- 2 years Close Brothers (5.25% AER fixed): in £10,000 Transfers in
- 3 years Close Brothers (5.25% AER fixed): in £10,000 Transfers in
- 4 years Zopa (5.15% AER fixed) min: £1
- 5 years Close Brothers (5.15% AER fixed): in £10,000 Transfers in
- Lifetime Moneybox (4% AER, drops to 3.25% after one year): min £1
Where to put your savings in July 2023
Below are my “simple” tips – the accounts that’ll give you the highest rates, though make sure you check for updates in my regularly updated savings best buy article,
Of course you might be able to fix your money for better rates. The same goes if you’re happy to have your money in lots of different places. And you might have existing accounts closed to new customers with better rates. But if you just want one or two accounts, these are the ones I’d go for right now.
Best places to save up to £5,000
The highest paying option for the first £5,000 is the Barclays Blue Rewards Rainy Day Saver via a current account.
|£5,000||Barclays Blue Rewards Rainy Day Saver||5.12%||Can only earn interest on the first £5,000 saved and requires two direct debits a month to cancel out a £5 monthly fee|
Best places to save above £5,000
Again, going on the idea of keeping things simple, I’d next look at an easy access account without any restrictions.
|Up to £85,000||Family Building Society||4.35%|
Best places to save extra each month
If you’re looking to save every month then it’s worth looking at a regular or monthly saver. The top paying ones all require a current account, but I’d go for the Club Lloyds Monthly Saver over the higher paying First Direct account one as you can pay in more each month, plus you get free cinema tickets or Disney+ on top.
|Up to £400 a month||Club Lloyds Monthly Saver||6.25%||Requires a current account, fixed for 12 months|
Best places to avoid tax on interest
If you’re going above your Personal Savings Allowance (or don’t have one), then you can obviously save up to £20,000 in an ISA and £50,000 in Premium Bonds. I’m assuming you don’t need access to this money.
|Up to £20,000 (more if transferred)||Zopa 1 year fixed ISA||5.21%|
Best ethical savings option
The easy shorthand is to go for a building society account, though Tandem also claims to be building a green bank and has decent rates. Here are the best paying ISA and non-ISA.
|Up to £20,000||Principality Building Society easy access ISA||3.9%|
|Up to £1m||Family Building Society easy access||4.35%|
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