Savers have been handed a boost as returns not seen for almost two years make a comeback. At the same time, the number of savings options available to Brits has also seen a considerable rise.
The average one-year fixed-rate bond has risen to 4.28%, its highest level since October 2024, according to Moneyfacts. Longer-term fixed-rate deals have also strengthened, with the average rate reaching 4.31% – the highest since January 2024. The rise gives savers a fresh opportunity to lock in a guaranteed return on their cash, particularly as there is growing uncertainty over the future direction of interest rates.
Moneyfacts said the average one-year fixed rate has now risen for six consecutive months, while longer-term fixed rates have increased for seven months in a row. There is also an unprecedented amount of choice for savers. The number of savings products available has reached a record 2,642, including ISAs. Excluding ISAs, there are 1,894 deals – the highest number since records began in 2007.
The number of cash ISAs has also climbed to 748, while the total number of savings providers has reached a record 160.
Caitlyn Eastell, personal finance analyst at Moneyfacts, said: “Savers have been handed another welcome boost this month, with fixed savings rates continuing to climb and competition remaining incredibly strong across the market.”
She added that the improvement would be particularly welcome for people who had been waiting to see whether rates would rise further before fixing their money. But not all savings rates are moving upwards.
The average easy-access rate has remained unchanged at 2.53% for the third month running, while the average easy-access ISA rate has slipped slightly to 2.71%.
The average notice account rate, meanwhile, has risen to 3.42%, its highest level since January. Overall, the Moneyfacts Average New Savings Rate has risen for the seventh consecutive month, reaching 3.62%, up from 3.46% a year ago.
Eastell said savers were increasingly moving their money around in search of better returns.
She pointed to recent Bank of England figures showing that almost £3.5billion had been withdrawn from easy-access and current accounts, while overall household deposits still increased by £3.8billion. She said this suggested savers were ‘reassessing where their money is being held and moving their cash between different accounts’.
The latest figures also suggest savers are being given more time to shop around. Moneyfacts said the average shelf-life of fixed-rate products had increased from 32 days to 43 days, meaning competitive deals are staying on the market for longer.
However, savers should still compare rates carefully before locking their money away, particularly because fixed accounts can prevent access to cash for months or years. For those prepared to fix their savings, the latest figures show that returns have improved significantly from a year ago. The average one-year fixed bond rate has risen from 3.96% to 4.28%, while the average longer-term rate has climbed from 3.89% to 4.31%.
