In December, NS&I – the government’s saving arm – relaunched its one and three-year guaranteed growth and income bonds. They can be opened by anyone over the age of 16 and the minimum investment is £500 while the maximum is £1m per person per issue. The three-year guaranteed growth bond paid 2.20% gross/AER while the income bond paid 2.15% gross (2.17% AER).

But as of today, new customers will receive 1.95% gross/AER on the three-year growth product while those opting for the income bond will receive 1.90% gross (1.92% AER). NS&I confirms there’s no change for existing customers who bought the products since their relaunch in December, and there’s no change to the rates on the one-year options. Also, customers who have maturing three-year guaranteed growth bonds and three-year 65+ guaranteed growth bonds (pensioner bonds) will be able to roll over their investment for another three years at the 2.20% gross/AER rate.

Separately, the online-only investment guaranteed growth bonds paying 2.20% gross/AER for three years on £100 to £3,000 will remain on sale until 10 April, NS&I confirmed.

Sarah Coles, personal finance analyst at Hargreaves Lansdown, said pensioners may be relieved “that the chair isn’t being whipped away just as they sit down”, but they shouldn’t be tempted to settle for the 2.2% rate. Coles explained: “In the current market you can get up to 2.26% over this period. That’s assuming that a three-year fix is still the right option for them. When any fixed rate matures, it’s a valuable opportunity to revisit whether you need more flexibility, whether you want to fix for longer, and whether cash is the right place for this part of your portfolio at all.”

She listed the following options:

Easy access

If you need to get access to your money quickly, you can currently get up to 1.35% on an easy access account (Icici Bank). You are paying the price in terms of interest, but it’s the right solution if you will need the money at short notice. It also has the advantage of offering flexibility if interest rates rise.

Alternatively, you can consider Premium Bonds. These don’t pay any interest, but offer easy access alongside the chance of a major tax-free win – although of course wins are not guaranteed, so money in Premium Bonds could easily lose value after inflation.

Fixed rates

If you are saving between one and five years, it’s worth considering fixing for a period. In an era of rising interest rates, you run the risk with a long-term fix that rates will rise and make your account less competitive. However, some savers value the certainty of a long-term fix over the ambiguity of predicting rate rises.

If you are concerned about rising rates over the medium term, you can fix for one year at 1.9%, and for two at 2.1%. This means the one-year fix is the same level of the NS&I three-year bond for new customers.

Longer-term

If you can put aside the cash for five-10 years or more, and you are prepared to take more risk with your money, you can consider stock market investments. This will put your capital at risk, but if you have a longer time horizon, your money has more potential to grow than it would in a savings account.