SmartSave has increased the interest rate on its one-year fixed savings account to 5.28 percent this week, earning an “excellent” Moneyfacts rating.
The account suits savers with larger sums to invest, requiring a minimum deposit of £10,000 to open.
However, savers can expect to see sizeable returns. To give an example of the interest the pot can amass at its current rate, a £10,000 deposit is estimated to earn £528 over the course of a year.
Commenting on the deal, Caitlyn Eastell, a spokesperson at Moneyfactscompare.co.uk, said: “This week SmartSave has increased the rate on its One Year Fixed Rate Saver. The account now pays an appealing 5.28 percent, for investors able to contribute a minimum of £10,000.
“It is important to note that early access is not permitted, so careful planning may be required.
“On a more positive note, savers may be glad to see that they can make further additions for 14 days from account opening.
“Overall, the account receives an Excellent Moneyfacts product rating.”
While SmartSave’s account may be currently topping the table of one-year fixes, the competition doesn’t fall too far behind.
MBNA’s Fixed Saver One Year offers an AER of 5.27 percent on its Fixed Saver. The account can be opened with a minimum deposit of £1,000 and interest is paid on maturity.
Up to £750,000 can be invested overall and withdrawals are not allowed until the term ends.
Mizrahi Bank places just behind with an AER of 5.22 percent on its Fixed Term Deposit, exclusive to Flagstone.
The account can be opened with a minimum deposit of £10,000 and interest is paid on maturity. Up to £1million can be invested overall and withdrawals are not allowed until the term ends.
Britons are increasingly moving their wealth into liquid assets, such as cash savings accounts, as interest rates have risen, Investec Bank analysis of ONS data unveils.
Its analysis shows UK households now hold on average a third (31 percent) of their financial assets in cash, bank deposits or money market instruments.
The corresponding figure in January 2022 was 28 percent, while in January 2021 it was 26 percent and in January 2020 it was 24 percent.
David Hunt, Head of Retail Savings at Investec, said: “Soaring rates on savings accounts, combined with a difficult year for stock markets, has meant that UK investors have been increasing their cash holdings while reducing their exposure to investments. Our research suggests that this trend is set to continue.”
However, Mr Hunt noted: “While it is crucial to have a savings buffer, investors should seek professional advice when making decisions about their investments and the balance they have with cash savings.”
