Are you looking for a way to safely grow a lump sum of money? Fixed rate savings accounts (also known as fixed term savings accounts or fixed rate bonds) could be right for you, as they provide a way to benefit from competitive interest rates without risking your savings.

The rundown
  • Fixed rate accounts typically offer better interest rates than standard savings accounts
  • The FSCS protects up to £85,000 of your money per person, per banking group
  • Different terms are available, depending on how long you want to lock away your money for

What is a fixed rate savings account?

A fixed rate savings account allows you to lock your money in at a fixed rate of interest for a specified time, usually one, two, three or five years, as well as six month terms. The length of time (term) that’s best for you depends on your savings goals, but fixed term savings accounts with longer terms typically offer higher interest rates than those with shorter terms. Whichever term you choose, all fixed term savings accounts at Raisin UK offer a risk-free way to grow your savings and secure a competitive rate of interest.

What is the difference between a fixed term savings account, a fixed rate savings account and a fixed rate bond?

There is no difference between a fixed term savings account, a fixed rate savings account and a fixed rate bond. They are simply different names for the same type of savings account. At Raisin UK, we typically refer to fixed term savings accounts as fixed rate bonds, but you’ll see them referred to as fixed term deposits as well.

How do fixed term savings accounts work?

You can open a fixed term savings account with a lump sum deposit that you decide when applying for the account. Once your account is open, you can’t top up your balance or withdraw your money for the fixed term’s duration, so it’s important to choose a deposit amount that works for you. 

Fixed term savings accounts include a minimum and maximum deposit amount, typically from £500 for a minimum deposit and up to £2,000,000 for a maximum deposit. At Raisin UK, your money is always safe, which is why we’ll only allow you to deposit up to the maximum deposit protection amount, which is £85,000 per person, per banking group for FSCS deposit protected accounts.

When you apply for a fixed term savings account through our marketplace, you can make as many transfers as you want to meet your initial deposit amount, but it isn’t possible to make any further deposits after your initial deposit, nor can you usually close this type of account before it matures at the end of the fixed term.

What are the benefits of fixed rate savings accounts?

A high interest fixed savings account might be a good option for you if the following benefits are important to you:

  • You need complete confidence that your savings are safe
  • You don’t want to worry about the interest rate changing
  • You won’t need access to your deposit before your account matures
  • You want to avoid the temptation of spending your deposit

As you can see from the chart below, fixed rate savings accounts typically offer more competitive interest rates than other types of savings accounts:

What fixed rate terms are available?

You can find the best fixed term savings account for you by comparing accounts from a range of UK banks in our marketplace:

In order to make the most of your savings, you might want to consider opening more than one fixed term account. By taking the approach in the chart below, for example, you would have an account coming to the end of its term each year while taking advantage of the higher interest rates that are typical of longer-term bonds.

If you need more flexibility from your savings account, an easy access or notice account might be a better option for you.

How is interest on fixed rate savings accounts calculated?

Interest on fixed term savings accounts is advertised as an annual equivalent rate (AER). The amount you’ll earn from a fixed rate bond depends on the following factors:

  1. The length of your fixed term
  2. Your deposit amount
  3. The interest rate (AER)
  4. How the bank calculates interest

Will I be taxed on my savings?

UK taxpayers can earn interest on savings up to set amounts without paying tax. Basic rate taxpayers can earn up to £1,000 of interest per year, and higher-rate taxpayers up to £500.

Can I lose my money if I save into a fixed rate account?

No, as long as you only open fixed rate savings accounts through regulated banks or building societies offering protection through a deposit guarantee scheme, you won’t lose your money. A fixed rate account is typically a protected savings account and not what you might consider a risky investment. In accordance with UK banking regulations, the Financial Services Compensation Scheme (FSCS) protects deposits of up to £85,000 per person, per banking group. This amount doubles to £170,000 with a joint account.

Why a fixed term savings account from our marketplace might be right for you

Choose from a range of fixed term savings accounts at, all of which feature the following benefits:

  • A risk-free way to grow your savings
  • Earn fixed, competitive rates of interest
  • Higher interest rates on longer-term accounts
  • You’ll know when you can access your savings
  • It’s simple and easy to manage your savings online
  • They’re free to open at Raisin UK
  • If you open a fixed term savings account through a UK regulated bank, the FSCS protects your money up to £85,000 per person, per banking group

How to open a fixed rate savings account

At Raisin UK, the fixed rate savings accounts in our marketplace are free to open. The highest interest rate for a fixed rate savings account on our marketplace is currently 2.05% AER. 

Register for a free Raisin UK Account to apply for savings accounts from our partner banks in three steps:

  1. Log in to your Raisin UK Account
  2. Click to apply (no more application forms) 
  3. Transfer your deposit 

As soon as your application is approved, you’ll start earning interest. It’s that simple.

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