You are here: Home - Saving & Banking - News -

The savings accounts to beat inflation

Written by:
UK consumer price inflation (CPI) fell to 2.4% last month meaning 16 savings accounts now beat or match inflation, according to Moneyfacts.

This will be welcome news for savers who at times this year have found no open-to-all savings accounts beat inflation.

Savers will have to tie their money up for at least four years to earn an interest rate above CPI, with Vanquis Bank’s 4-year bond paying 2.52%.

They can get 2.79% from UBL Bank UK by opting for a five-year fix.

Two providers offer a rate of 2.75% on seven-year fix products – PCF Bank and Secure Trust Bank.

The table below shows a full list of the 16 inflation beating accounts:

inflation beating

Inflation falling will lessen the pain for savers disappointed by the Bank of England keeping the base rate on hold at 0.5% earlier this month.

They will also be boosted by news that rate rises in the savings market have now outnumbered cuts for 16 months in a row.

Charlotte Nelson, finance expert at Moneyfacts, said: “It is just six months on from the first rate rise since the financial crisis, and in that time the savings market has seen a significant boost. With rate increases outweighing cuts every month, there have now been just over 800 individual rate increases since November 2017.

“All this extra competition has seen rates rise, particularly in the fixed rate bond sector. For example, the average two-year fixed rate bond stands at 1.50% today, 0.07% higher than November, and marking the first time the two-year average has risen to 1.50% since April 2016.”

Newer banks are outshining high street names when it comes to rate rises. The average easy access account from the mainstream banks – Bank of Scotland, Barclays, Halifax, HSBC, Lloyds Bank, Nationwide, NatWest, RBS and Santander – is just 0.30%, while the market average is 0.51%, according to Moneyfacts.

“Unfortunately, the main banks have yet to get involved in the market and are still reluctant to boost their rates,” said Nelson.

“Savers now more than ever need to vote with their feet and ensure they get the best offer available.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

If one of your jobs this month is to get your finances in order, moving your savings to a higher paying deal i...

Coronavirus and your finances: what help can you get?

News and updates on everything to do with coronavirus and your personal finances.

Everything you need to know about being furloughed

If you’ve been ‘furloughed’ by your company, here’s what it means…

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

  • @YourMoneyUK All you need to know about the latest Current Account Switching winners and losers - hats off to Starl…
  • RT @WeareJust_PR: Many people struggling to make ends meet may not realise they are entitled to financial help or find the system too confu…
  • RT @WeareJust_PR: Many people struggling to make ends meet may not realise they are entitled to financial help or find the system too confu…

Read previous post:
The ‘financial planning blind spot’ putting thousands of retirees at risk

Four in five retirees drawing on their pension pot have yet to set up a Lasting Power of Attorney (LPA),...