UK Fixed Rate Savings Bond Interest Rates At All Time Low
Personal_Finance / Savings Accounts Dec 05, 2012 - 05:25 AM GMTBy: MoneyFacts
Moneyfacts research reveals the average rate of fixed term bonds across every term from one year bonds all the way through to five year bonds has dramatically fallen to an all time low.
Sylvia Waycot, Finance expert at Moneyfacts.co.uk, said:
“All forms of savings rates, from easy access to notice accounts, are plummeting. This month, however, saw the savers’ darling, fixed term bonds drop to an all-time low, predominantly as a casualty of the Governments Funding for Lending Scheme which has caused chaos in the savings market.
“The current fall will leave many savers uncertain where to turn; fixing a long term bond of five years at this new low may send a shiver down many a back, while others will wonder if rates will fall further still. The answer is sadly, we don’t know.
“You will need to be particularly on your guard if you have an existing bond that is due to mature because if you do nothing you may find it is reinvested for the same term in the latest bond equivalent – which at these rates may not be what you want.
“Most fixed rate bonds don’t allow access during the term or, if they do, there is a hefty penalty for doing so. Before committing funds savers need to ensure they won’t need access to their money.
“As with most things, there are still a few good offers out there, it just means that savers must put more effort into searching them out and when they find one, they need to act fast.”
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