Rachel Springall, Finance Expert at Moneyfacts, said:
“The savings market continues to move in a positive direction as rates across most of the savings spectrum improve at a slow and steady pace. Savers who may be coming off a one-year fixed bond and wish to lock into a new deal will find notable improvements to the top rate tables over the past few months, and whilst the average return is 0.03% less than a year ago – it is still moving in the right direction and further away from the record low recorded in April this year. Longer-term fixed bonds also improved this month, but it is unclear whether savers are yet prepared to tie up their money for longer than a year when chasing the top returns.
“Choice has expanded in the market for a fourth consecutive month which is encouraging for savers and a catalyst for providers to keep on top of the competition and perhaps enhance their deals in response. We now have the most savings providers on record, and more brands can mean more competition. After the market endured turmoil due to the pandemic and subsequent base rate cuts, there is more room for improvement, but it is still good to see rates rise instead of fall as only a few months ago average rates throughout sat at record lows.
“Savers yet to utilise their ISA allowance or who are perhaps considering their options if they have an ISA set to mature this autumn will note some improvements to the market as there are now more ISA options than there have been since October 2020 when there were 373 deals. However, when comparing average rates, fixed ISAs are still paying below their fixed bond counterparts, so savers must consider their options if they have a Personal Savings Allowance and some savers may even decide to withdraw funds from ISAs entirely. Indeed, according to the Bank of England, there was an outflow of £699m from cash ISAs during June, bringing the total outflow so far during 2021 to almost £2.8bn. However, easy access accounts remain a firm favourite amongst savers looking for flexibility with their cash. The inflow into sight deposits during June was almost £10bn, and over £66bn so far this year.
“Providers and savers alike will need to keep a close eye on the ever-changing market by monitoring the top rate tables. The consecutive rate rises across much of the savings spectrum are green shoots of life to a market that felt barren only a few months ago and there is no telling how long a good deal will last. It is evident that savers have disposable income to put aside and some may be using their pot to supplement their income, so it is hoped providers will inject more competition in the months to come to encourage consumers to take advantage.”
Rachel Springall, Finance Expert at Moneyfacts, said:
“The savings market continues to move in a positive direction as rates across most of the savings spectrum improve at a slow and steady pace. Savers who may be coming off a one-year fixed bond and wish to lock into a new deal will find notable improvements to the top rate tables over the past few months, and whilst the average return is 0.03% less than a year ago – it is still moving in the right direction and further away from the record low recorded in April this year. Longer-term fixed bonds also improved this month, but it is unclear whether savers are yet prepared to tie up their money for longer than a year when chasing the top returns.
“Choice has expanded in the market for a fourth consecutive month which is encouraging for savers and a catalyst for providers to keep on top of the competition and perhaps enhance their deals in response. We now have the most savings providers on record, and more brands can mean more competition. After the market endured turmoil due to the pandemic and subsequent base rate cuts, there is more room for improvement, but it is still good to see rates rise instead of fall as only a few months ago average rates throughout sat at record lows.
“Savers yet to utilise their ISA allowance or who are perhaps considering their options if they have an ISA set to mature this autumn will note some improvements to the market as there are now more ISA options than there have been since October 2020 when there were 373 deals. However, when comparing average rates, fixed ISAs are still paying below their fixed bond counterparts, so savers must consider their options if they have a Personal Savings Allowance and some savers may even decide to withdraw funds from ISAs entirely. Indeed, according to the Bank of England, there was an outflow of £699m from cash ISAs during June, bringing the total outflow so far during 2021 to almost £2.8bn. However, easy access accounts remain a firm favourite amongst savers looking for flexibility with their cash. The inflow into sight deposits during June was almost £10bn, and over £66bn so far this year.
“Providers and savers alike will need to keep a close eye on the ever-changing market by monitoring the top rate tables. The consecutive rate rises across much of the savings spectrum are green shoots of life to a market that felt barren only a few months ago and there is no telling how long a good deal will last. It is evident that savers have disposable income to put aside and some may be using their pot to supplement their income, so it is hoped providers will inject more competition in the months to come to encourage consumers to take advantage.”
