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Savers urged to switch as high inflation persists

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Rachel Springall, Press Officer
Rachel Springall, Press Officer / Finance Expert T: 01603 476210 E: Email Rachel
19/01/2022

Savers urged to switch as high inflation persists

Savers comparing deals have been urged to act swiftly to take advantage of top rates, with some changing since last month’s inflation announcement. As high inflation persists, getting the best savings deal is essential to soften its eroding impact. The latest analysis from Moneyfacts.co.uk reveals the top rate deals available to savers searching for a competitive return.

 

  • The Consumer Price Index (CPI) rose to 5.4% during December, from 5.1% in November.
  • The number of deals able to outpace inflation has not changed since last month. There is not one standard savings account that can outpace 5.4%*.
  • The predicted rate for inflation during Q4 2022 is 3.4%.
  • In January 2021, 157 deals (two easy access accounts, eight notice accounts, two variable rate ISAs, 34 fixed rate ISAs and 111 fixed rate bonds) could beat 0.6% (December CPI) and in January 2020, 331 deals (210 fixed rate bonds, 79 fixed rate ISAs, five variable rate ISAs, 29 notice accounts and eight easy access accounts) could beat 1.3% (December CPI)*.

Savers urged to switch as high inflation persists

Savers comparing deals have been urged to act swiftly to take advantage of top rates, with some changing since last month’s inflation announcement. As high inflation persists, getting the best savings deal is essential to soften its eroding impact. The latest analysis from Moneyfacts.co.uk reveals the top rate deals available to savers searching for a competitive return.

 

  • The Consumer Price Index (CPI) rose to 5.4% during December, from 5.1% in November.
  • The number of deals able to outpace inflation has not changed since last month. There is not one standard savings account that can outpace 5.4%*.
  • The predicted rate for inflation during Q4 2022 is 3.4%.
  • In January 2021, 157 deals (two easy access accounts, eight notice accounts, two variable rate ISAs, 34 fixed rate ISAs and 111 fixed rate bonds) could beat 0.6% (December CPI) and in January 2020, 331 deals (210 fixed rate bonds, 79 fixed rate ISAs, five variable rate ISAs, 29 notice accounts and eight easy access accounts) could beat 1.3% (December CPI)*.

 

Savings market analysis

Top savings deals at £10,000 gross

15-Jan-20

20-Jan-21

15-Dec-21

Today

Easy access account

Gatehouse Bank – 1.40%**

ICICI Bank UK – 0.60%

Investec Bank plc – 0.71%

Family Building Society – 0.72%

Notice account

BLME – 1.70% (90-day)**

ICICI Bank UK – 0.85% (95-day)

Secure Trust Bank – 1.10% (120-day)

Shawbrook Bank – 1.08% (120-day)

One-year fixed rate bond

BLME – 1.80%**

QIB (UK) – 0.80%**

Gatehouse Bank – 1.41%**

Investec Bank plc – 1.36%

Two-year fixed rate bond

BLME – 1.95%**

Gatehouse Bank – 1.10%**

Gatehouse Bank – 1.60%**

Charter Savings Bank – 1.62%

Three-year fixed rate bond

BLME – 2.10%**

Gatehouse Bank – 1.25%**

UBL UK – 1.85% (payable on maturity)

Zenith Bank – 1.85%

Four-year fixed rate bond

BLME – 2.10%**

BLME – 1.05%**

Gatehouse Bank – 1.92%**

Gatehouse Bank – 1.92%**

Five-year fixed rate bond

UBL UK – 2.50% (payable on maturity)

Gatehouse Bank – 1.50%**

UBL UK – 2.14% (payable on maturity)

UBL UK – 2.14% (payable on maturity)

**Islamic bank, pays an expected profit rate. Inflation announcement dates. Source: Moneyfacts.co.uk

 

ISA market analysis

Top savings deals at £10,000 gross

15-Jan-20

20-Jan-21

15-Dec-21

Today

Easy access ISA

Al Rayan Bank – 1.35%**

Al Rayan Bank – 0.60%**

Shawbrook Bank – 0.67%

Shawbrook Bank – 0.67%

Notice ISA

Paragon Bank 1.31% (120-day)

Aldermore – 0.55% (30-day)

Aldermore – 0.55% (30-day)

Aldermore – 0.55% (30-day)

One-year fixed rate ISA

Charter Savings Bank – 1.41%

Al Rayan Bank – 0.65%**

Shawbrook Bank – 0.93%

Coventry BS – 1.00%

Two-year fixed rate ISA

Metro Bank – 1.60%

Gatehouse Bank – 0.80%**

West Brom BS – 1.20%

Newcastle BS – 1.30%

Three-year fixed rate ISA

Marsden BS – 1.70%

Gatehouse Bank – 0.90%**

West Brom BS – 1.40%

UBL UK – 1.43% (payable on maturity)

Four-year fixed rate ISA

Secure Trust Bank – 1.80%

Hodge Bank – 0.65%

UBL UK – 1.39% (payable on maturity)

UBL UK – 1.54% (payable on maturity)

Five-year fixed rate ISA

UBL UK – 2.11% (on maturity)

Gatehouse Bank – 1.30%**

West Brom BS – 1.75%

UBL UK – 1.82% (payable on maturity)

**Islamic bank, pays an expected profit rate. Inflation announcement dates. Source: Moneyfacts.co.uk

 

 

Savings market analysis

Top savings deals at £10,000 gross

15-Jan-20

20-Jan-21

15-Dec-21

Today

Easy access account

Gatehouse Bank – 1.40%**

ICICI Bank UK – 0.60%

Investec Bank plc – 0.71%

Family Building Society – 0.72%

Notice account

BLME – 1.70% (90-day)**

ICICI Bank UK – 0.85% (95-day)

Secure Trust Bank – 1.10% (120-day)

Shawbrook Bank – 1.08% (120-day)

One-year fixed rate bond

BLME – 1.80%**

QIB (UK) – 0.80%**

Gatehouse Bank – 1.41%**

Investec Bank plc – 1.36%

Two-year fixed rate bond

BLME – 1.95%**

Gatehouse Bank – 1.10%**

Gatehouse Bank – 1.60%**

Charter Savings Bank – 1.62%

Three-year fixed rate bond

BLME – 2.10%**

Gatehouse Bank – 1.25%**

UBL UK – 1.85% (payable on maturity)

Zenith Bank – 1.85%

Four-year fixed rate bond

BLME – 2.10%**

BLME – 1.05%**

Gatehouse Bank – 1.92%**

Gatehouse Bank – 1.92%**

Five-year fixed rate bond

UBL UK – 2.50% (payable on maturity)

Gatehouse Bank – 1.50%**

UBL UK – 2.14% (payable on maturity)

UBL UK – 2.14% (payable on maturity)

**Islamic bank, pays an expected profit rate. Inflation announcement dates. Source: Moneyfacts.co.uk

 

ISA market analysis

Top savings deals at £10,000 gross

15-Jan-20

20-Jan-21

15-Dec-21

Today

Easy access ISA

Al Rayan Bank – 1.35%**

Al Rayan Bank – 0.60%**

Shawbrook Bank – 0.67%

Shawbrook Bank – 0.67%

Notice ISA

Paragon Bank 1.31% (120-day)

Aldermore – 0.55% (30-day)

Aldermore – 0.55% (30-day)

Aldermore – 0.55% (30-day)

One-year fixed rate ISA

Charter Savings Bank – 1.41%

Al Rayan Bank – 0.65%**

Shawbrook Bank – 0.93%

Coventry BS – 1.00%

Two-year fixed rate ISA

Metro Bank – 1.60%

Gatehouse Bank – 0.80%**

West Brom BS – 1.20%

Newcastle BS – 1.30%

Three-year fixed rate ISA

Marsden BS – 1.70%

Gatehouse Bank – 0.90%**

West Brom BS – 1.40%

UBL UK – 1.43% (payable on maturity)

Four-year fixed rate ISA

Secure Trust Bank – 1.80%

Hodge Bank – 0.65%

UBL UK – 1.39% (payable on maturity)

UBL UK – 1.54% (payable on maturity)

Five-year fixed rate ISA

UBL UK – 2.11% (on maturity)

Gatehouse Bank – 1.30%**

West Brom BS – 1.75%

UBL UK – 1.82% (payable on maturity)

**Islamic bank, pays an expected profit rate. Inflation announcement dates. Source: Moneyfacts.co.uk

 

Rachel Springall, Finance Expert at Moneyfacts.co.uk, said:

“Savers will see inflation continuing to eat its way into their cash deposits and it is expected to remain high over the spring, according to the Bank of England, before falling back towards the Government’s desired 2% target. However, consumers may note from the latest top savings rates, they would need to lock their money away for five years to beat 2%. As interest rates and inflation were particularly volatile in 2021, it would be understandable if many savers feel uncomfortable committing to a lengthy fixed term. Instead, savers would be wise to ensure they are getting the best possible return on their cash savings account that suits their needs and switch if they are getting a poor deal.

“Savers who are looking to utilise their ISA allowance or indeed find a new home for their existing pot will be pleased to see some improvements to top rates since the last inflation announcement. Coventry Building Society currently pays the best ISA rate over one year, Newcastle Building Society has the best over two years and UBL UK has the best over three, four and five-year fixed terms. However, on fixed bonds outside of an ISA wrapper, higher returns can be found. The top one-year bond now pays 1.36% from Investec Bank plc, compared to 1.00% as interest for the ISA equivalent from Coventry Building Society. If savers are comparing bonds and ISAs, then it’s imperative they consider their Personal Savings Allowance foremost.

“Top savings rates do not always last on the shelf for long, so savers would need to be quick to take advantage. As an example, the top easy access deal last month came from Investec Bank Plc at 0.71%, but was withdrawn after a few weeks and the market-leading one-year bond from Gatehouse Bank last week was withdrawn this week. As the Bank of England increased base rate to 0.25% last month, we may see some improvement to variable rates but, as we have seen before, it can take a few months for savers to benefit from the rise and is not guaranteed. Comparing and switching deals is therefore crucial for consumers to get the best return on their cash, and signing up to newsletters and checking top rate tables regularly is wise to keep up with changes.”

*Data note: Please note that these savings product numbers only include deals that are available to UK residents (easy access, notice, fixed rate bonds, variable or fixed ISAs) and excludes regular savers and children’s savers (this figure does not count each interest payment option for each account), based on a £10,000 deposit. Higher rates may be available for other levels of deposit.

Rachel Springall, Finance Expert at Moneyfacts.co.uk, said:

“Savers will see inflation continuing to eat its way into their cash deposits and it is expected to remain high over the spring, according to the Bank of England, before falling back towards the Government’s desired 2% target. However, consumers may note from the latest top savings rates, they would need to lock their money away for five years to beat 2%. As interest rates and inflation were particularly volatile in 2021, it would be understandable if many savers feel uncomfortable committing to a lengthy fixed term. Instead, savers would be wise to ensure they are getting the best possible return on their cash savings account that suits their needs and switch if they are getting a poor deal.

“Savers who are looking to utilise their ISA allowance or indeed find a new home for their existing pot will be pleased to see some improvements to top rates since the last inflation announcement. Coventry Building Society currently pays the best ISA rate over one year, Newcastle Building Society has the best over two years and UBL UK has the best over three, four and five-year fixed terms. However, on fixed bonds outside of an ISA wrapper, higher returns can be found. The top one-year bond now pays 1.36% from Investec Bank plc, compared to 1.00% as interest for the ISA equivalent from Coventry Building Society. If savers are comparing bonds and ISAs, then it’s imperative they consider their Personal Savings Allowance foremost.

“Top savings rates do not always last on the shelf for long, so savers would need to be quick to take advantage. As an example, the top easy access deal last month came from Investec Bank Plc at 0.71%, but was withdrawn after a few weeks and the market-leading one-year bond from Gatehouse Bank last week was withdrawn this week. As the Bank of England increased base rate to 0.25% last month, we may see some improvement to variable rates but, as we have seen before, it can take a few months for savers to benefit from the rise and is not guaranteed. Comparing and switching deals is therefore crucial for consumers to get the best return on their cash, and signing up to newsletters and checking top rate tables regularly is wise to keep up with changes.”

*Data note: Please note that these savings product numbers only include deals that are available to UK residents (easy access, notice, fixed rate bonds, variable or fixed ISAs) and excludes regular savers and children’s savers (this figure does not count each interest payment option for each account), based on a £10,000 deposit. Higher rates may be available for other levels of deposit.

Notes to editors

Pioneering financial comparison technology for over 30 years.

Moneyfacts Group plc is the UK’s leading provider of retail financial product data. Used by virtually every bank and building society in the UK, and supplied to the Bank of England, Financial Conduct Authority, Financial Ombudsman Service, HM Treasury, Prudential Regulatory Authority and UK Finance.

Our expert research team monitors the thousands of mortgages, savings, credit card, personal loan, business banking, life, pension and investment products in the UK.

Moneyfacts.co.uk is a financial product price comparison site, launched in 2000, which helps consumers compare thousands of financial products, including credit cards, savings, mortgages and many more. Unlike other comparison sites, Moneyfacts.co.uk shows whole of market data regardless of commercial bias, showing consumers a true picture of the best products based on the criteria they select.

We hope you find this press release insightful. We would appreciate a link back to Moneyfacts.co.uk if you decide to source this information.

For more information about us please see our key facts.

Broadcast

Our broadcast suite enables our finance experts to appear in-vision for television, and we regularly comment live on national and regional radio.

To arrange an interview for radio or television, please contact our press department. We have an in-house broadcast room.

 

Notes to editors

Pioneering financial comparison technology for over 30 years.

Moneyfacts Group plc is the UK’s leading provider of retail financial product data. Used by virtually every bank and building society in the UK, and supplied to the Bank of England, Financial Conduct Authority, Financial Ombudsman Service, HM Treasury, Prudential Regulatory Authority and UK Finance.

Our expert research team monitors the thousands of mortgages, savings, credit card, personal loan, business banking, life, pension and investment products in the UK.

Moneyfacts.co.uk is a financial product price comparison site, launched in 2000, which helps consumers compare thousands of financial products, including credit cards, savings, mortgages and many more. Unlike other comparison sites, Moneyfacts.co.uk shows whole of market data regardless of commercial bias, showing consumers a true picture of the best products based on the criteria they select.

We hope you find this press release insightful. We would appreciate a link back to Moneyfacts.co.uk if you decide to source this information.

For more information about us please see our key facts.

Broadcast

Our broadcast suite enables our finance experts to appear in-vision for television, and we regularly comment live on national and regional radio.

To arrange an interview for radio or television, please contact our press department. We have an in-house broadcast room.

 

Contact Us If you're looking for extra comment, a chart or more information, then please give us a call. We are always more than happy to help.
Rachel Springall Press Officer / Finance Expert
Eleanor Williams Press Officer / Finance Expert