September 2023’s savings round-up & news

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.

September’s savings update video

September’s savings news

Inflation falls & base rate expected to jump to 5.5%

Inflation has fallen, and now sits at 6.8%. It’s still well above the 2% target, but it does mean prices are rising at a slower rate.

The base rate currently stands at 5.25%, and we’ll find out on 21 September whether it increases again. The expectation is it’ll go up to 5.5% at this meeting, and perhaps as high as 5.75% or 6% by the end of the year.

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 typeBest rate 30 August 2023Best rate 8 August 2023Change in percentage points
Current account linked7%5.12%+1.88%
Easy access4.94%5%-0.06%
Limited access5%4.6%+0.4%
90-day notice5.45%5.35%+0.1%
120-day notice5.53%5.45+0.08%
Open to all5.5%6%-0.5%
6 month fix5.56%5.55%+0.01%
9 month fix5.79%5.64%+0.15%
12 month fix6.2%6.06%+0.14%
2 year fix6.05%6.1%-0.05%
3 year fix6%6.09%-0.09%
4 year fix5.85%5.85%+0%
5 year fix5.85%5.81%+0.04%
Easy access ISA4.43%4.4%+0.03%
1 year fix ISA5.78%5.75%+0.03%
2 year fix ISA5.73%5.9%-0.17%
Lifetime ISA4%4%+0%

Current account linked savings hits 7%

Santander pulled a suprise out of the bag by increasing the rate on it’s Edge Saver account to 7%. I’ve written a detailed analysis of it but the headlines are:

  • It’s only on balances of up to £4,000
  • After a year the rate drops to 4.5%
  • You must have an Edge current account which has a £3 monthly fee

I’m still waiting to hear back from Santander’s press office about whether the fee can be avoided on the Edge current account by not meeting the terms required to get cashback from the account – which would be handy for those earning cashback elsewhere or with multiple accounts. I’ll let you know when I know.

Despite these drawbacks, the rate is head an shoulders above what you can get elsewhere, and along with the 7% regular saver from First Direct the only accounts that beat inflation.

A quick note on Kroo. Rather than hike rates each time there’s a base rate change, they will be tracking at 0.9% below it from 15 October 2023.

That’s good news in a way – you’ll know you will be getting a hike when they happen, but it also means any drop will also mean your savings rate falls (though that’s not predicted to happen for a good while yet).

Current account linked saver picks as of 30/8/23

  • Santander Edge Saver (7% AER variable, includes 2.5% bonus for 12 months): min £0 / max £4,000
  • Barclays Blue Rewards Rainy Day Saver (5.12% AER variable): min £0 / max £5,000
  • Nationwide FlexDirect (5% AER variable for 12 months): min £0 / max £1,500
  • Kroo: (4.35% AER variable): min £0 / max £85,000

5% limited access, easy access not far behind

Tandem’s 5% easy access rate didn’t last long. The 0.35% top up required to get the full amount was axed for new users – though people who just missed out did get the chance to add it on, so do check if you can do this if you didn’t do it in time.

But you can still get 5% – though in a limited access account. Furness Building Society will let you take money out three times in the year.

But other full easy access accounts have improved to be just below this. Oxbury offers 4.94%, Shawbrook 4.93% and Cahoot (part of Santander) 4.9%. Ulster also offers 4.9% but only on balances above £50,000.

Chip also increased rates but not to the top of the table, and this time it did it quite slowly. Which is possibly how future increases will work. In a message shared with some customers, they wrote

“Yes, in the past we have reacted faster – but as the market becomes more saturated, we’re going to take more time going forwards to fully analyse and make sure we’re making the best decision for you all.

And when it comes to notice accounts, the top paying rates are all via Oxbury Bank. Worth considering if you know you don’t need your cash for at least three to six months.

One quick note on limited access accounts. The base rate tracker fro Hanley Economic Building Society that I told you about a few months ago is changing it’s terms and conditions. From 8 October 2023 you won’t be able to add any more money to this – so you’ve until this date to add any cash up to the £50,000 maximum. It’s no longer available to new customers.

Limited access picks as of 30/8/23

Easy access picks as of 30/8/23

  • Oxbury Bank (4.94% AER variable): min £1,000 / max £500,000
  • Shawbrook Bank (4.93% AER variable): min £1,000 / max £85,000
  • Cahoot (4.9% Variable): min £1/ max £2m
  • Ulster Bank (4.9% variable on balances over £50,000, otherwise 2.9% variable): min £0/ max £0
  • Chip (4.84% AER variable): min £1 / max £250,000
  • Monument Bank (4.81% AER variable): min £25,000 / max £400,000

Notice accounts picks as of 30/8/23

  • 3 months notice Oxbury Bank (5.45% AER variable): 90-day notice: min £1,000 / max £500,000
  • 4 months notice Oxbury Bank (5.53% AER variable): 120-day notice: min £1,000 / max £500,000
  • 6 months notice Oxbury Bank (5.59% AER variable): 180-day notice: min £1,000 / max £500,000

As ever, these could well change again in the coming days, so check out my best buys guide for more options and updates.

Regular savers remain steady

The only difference this month is the withdrawal of the 6% regular saver from Beehive Money. Otherwise there’s no changes to regular saver since last time.

We’ve got a dedicated Regular Saver best buy article, so you can see further details and more rates there.

Regular Saver accounts picks as of 30/8/23

  • 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)
  • Halifax Regular Saver (5.5% AER fixed) – min £25 / max £250 a month

In case you missed previous savings account updates:

Check out my savings updates from previous months for details on the following and more

  • First Direct’s 7% regular saver
  • Chip instant access changes

NS&I buck fixed rate downward trend

Last month I warned that we could have seen the top of the fixed rate bond market, and in the subsequent four weeks the top rates have gradually disappeared. That was until today, when National Savings & Investments (NS&I) launched a 6.2% paying one year bond!

I think it’s likely other banks will respond and hike one year fixed rates from the 6% and below level where most are sitting – but only if they need to generate savings deposits from customers.

Below this, the top two year account has fallen to 6.05% from Ford Money, while the best three year rate has dropped to 6% (via BLME). There’s a slight improvement on five years with a 5.85% rate from Tandem.

Another account to point out, though at a slightly lower rate is the Green Savings Bond from NS&I. This three year fixed account pays 5.7% – but your money will go towards green government spending initiatives. Here’s our full analysis.

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 30/8/23

  • 6 months Monument Bank (5.56% AER fixed): min £25,000 / max £400,000
  • 9 months Ahli United via Raisin (5.79% AER fixed): min £1,000 / max £85,000
  • 12 months NS&I (6.2% AER): min £500 / max £1m
  • 15 months Oak North Bank (6% AER fixed): min £1 / max £500,000
  • 18 months Ford Money (6.05% AER variable): min £500 / max £2m
  • 2-year Ford Money (6.05% AER variable): min £500 / max £2m
  • 3-year BLME (6% expected profit rate fixed): min £1,000 / £1m
  • 4-year Hampshire Trust Bank (5.85% AER fixed): min £1 / max £250,000
  • 5-year Tandem (5.85% AER fixed): min £1 / max £2.5m

Flexible fixed ISA offers 5.35%

For those of you who need the tax-free earnings offered by ISAs, there have once again been improvement on rates again this month- though the top paying 2 year fix from Natwest is no longer available.

One worth sharing is a Flexible ISA from Barclays. These two and three year fixed accounts will pay a little less than the top alternatives, but they work a little differently. You can make three withdrawals a year (up to 10% of the balance each time), and you can add new money as the years goes on.

So it’s a good option for those who want to keep saving to an ISA throughout the year and don’t expect to take much out. The two year pays 5.3% and the three year is at 5.35%

ISA picks as of 30/8/23

  • Easy access Shawbrook Bank (4.43% AER variable): min £1 Transfers in
  • Limited access Newcastle Building Society Double Access ISA (4.5% AER variable): min £1 Transfers in / Flexible
  • Flexible fixed Barclays Bank 2-Year Flexible Cash ISA (5.35% AER variable): min £1 Transfers in / Flexible
  • 1 year Shawbrook Bank (5.78% AER variable): min £500 Transfers in
  • 2 years Charter Savings Bank (5.73% AER fixed): min £1,000 Transfers in
  • 3 years Zopa  (5.56% AER fixed): min £1,000 Transfers in
  • 4 years Zopa (5.26% AER fixed) min: £1
  • 5 years Zopa (5.26% AER fixed) min: £1
  • Lifetime Moneybox (4% AER, drops to 3.25% after one year): min £1

Where to put your savings in September 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

The best rate is via Santander’s Edge Saver so it’s worth a look. But if you want to keep things simple, I’d look at using Oxbury for your savings (assuming you need access). Yes you can get a little more from Barclays, but it’s a faff (and unethical). If you can lock some away for a bit then you might consider a higher paying notice account.

Amount savedAccountRateNotes
Between £2,000 and £4,000Santander Edge Saver7%£3 monthly fee
Up to £85,000Oxbury Bank4.94%3 withdrawals

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.

Amount savedAccountRateNotes
Up to £400 a monthClub Lloyds Monthly Saver6.25%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.

Amount savedAccountRateNotes
Up to £20,000 (more if transferred)Charter Savings 2 year ISA5.73%

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.

Amount savedAccountRateNotes
Up to £20,000Leeds Building Society easy access ISA4.3%
Up to £100,000Green Savings Bonds (three year fix)5.7%

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