Savings Guide: Rates are staying higher - so what are your best options?
For this week's guide, Anna Bowes, personal finance expert from The Private Office, explores why savings rates are holding up better than expected.
Despite the Bank of England cutting the base rate this month, savings rates are proving to be resistant against any drops.
In fact, the top easy access rate is higher than the best rate that was on offer before the Bank's decision.
"Although many economists still seem to think that there could be two base rate cuts this year, the markets seem to think there will be only one, which could be a key reason that certainly the best rates on offer are holding up well," Bowes says.
Topping this week's table is the financial app Chip, which is paying 4.77% on the current issue of its easy access saver.
"This account is only available via an app, it may not be for everyone - and the rate will fall by 2.10% if more than four withdrawals are made per year," Bowes says.
"The rate also includes a 12-month bonus of 1.47%. This is a good illustration of the need to read all the terms and conditions so that you earn the interest you expect to."
Here's a look at the top rates available...
Fixed-rate bonds
We have seen some bonds withdrawn from the market this week, but overall there has been little movement in the best rates available.
The top one-year bond is paying 4.44%, while the top two-year bond is paying 4.42%.
Perhaps the most encouraging are the top three-year and five-year bonds, which are paying 4.43%.
Here are the top paying bonds...
Fixed-rate ISAs
The top one-year and two-year fixed cash ISA rates have remained the same over the past week, but the top five-year rate has increased slightly.
The top rate of 4.16% offered by Secure Trust Bank was pipped by UBL UK with an ISA paying 4.17%.
Over three years, unfortunately Ford Money withdrew its ISA paying 4.2%, leaving two providers, UBL UK and United Trust Bank both offering 4.17%.
"If interest rates do fall going forwards, if you've locked in at these longer-term rates, you may well still be congratulating yourself in the future - for grabbing top tax-free rates while you can," Bowes says.
Here are the best ISAs on the market...
Easy access cash ISAs
Competition has hotted up in this part of the savings market in the past week, but no provider has launched a rate to beat those seen at the beginning of May.
Chip, which held the top spot last week, saw its competitor Plum and Moneybox come for its title by launching new ISAs paying 4.85%, but it retaliated by upping its rate to match them.
Plum responded with a 4.98% rate, but Chip pipped it to the post by coming back with an ISA offering 4.99% for new customers.
"Once again though, the devil is also in the detail. Both of these providers are financial apps rather than banks themselves. With Plum, your cash could be deposited with a trio of banks - Citibank, Lloyds and QNB, whilst Chip uses Clearbank Ltd," Bowes points out.
Here's a look at the other accounts making it into our top table...
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