Best savings account deals after the autumn budget

🗝️ Key Points

• UK households are often looking for ways to make their money go further amid the cost of living crisis, and savings accounts can help after an autumn budget that hikes taxes.
• The Bank of England (BoE) opted to hold interest rates steady at 4% in November, was good news for savers, as this influences the rates set by banks and building societies on.
• Inflation data showed that the UK’s consumer prices index (CPI) fell to 3.6% in October, down from 3.8% in September.

UK households are often looking for ways to make their money go further amid the cost of living crisis, and savings accounts can help after an autumn budget that hikes taxes.

The Bank of England (BoE) opted to hold interest rates steady at 4% in November, was good news for savers, as this influences the rates set by banks and building societies on their products.

Inflation data showed that the UK’s consumer prices index (CPI) fell to 3.6% in October, down from 3.8% in September.

This raised expectations that the BoE could cut rates in December. Markets are pricing in a 90% chance that the BoE will lower rates by 0.25% next month, up from 85% earlier in the week before the budget.

Experts urge savers to shop around for the best deals and review their accounts regularly, as many may still be sitting on products that fail to beat inflation.

Mark Hicks, head of active savings at Hargreaves Lansdown, said: “Inflation may have eased, but it’s still running streets ahead of high street savings.”

Read more: Should you invest in gold?

He said that it was “more important than ever to shop around and consider online banks and savings platforms, because there are still plenty of accounts leading the pack, way ahead of inflation”.

“For money you don’t need for a specific period, it’s also well worth considering locking in a fixed rate deal now,” Hicks added.

Reeves announced changes to savings income. From 2027-28, the savings basic rate will be increased by 2 percentage points to 22%, the savings higher rate will be increased by 2 percentage points to 42% and the savings additional rate will be increased by 2 percentage points to 47%. This will take effect from 6 April 2027.

Read more: Budget keeps the door open for Bank of England interest rate cut in December

Gary Smith, senior partner in financial planning at wealth management firm Evelyn Partners, said: “With the existing freeze of the personal savings allowances and the forthcoming ISA reforms, savers in particular might wonder what to do with their cash. Income streams from cash deposits are already being reduced by falling interest rates, so the net return if savings are exposed to tax could end up being meagre indeed.

Easy-access accounts allow you to access your money when you need it. Fixed term means you can’t access your cash for the duration of the deal. They usually offer better rates, but you must be comfortable not touching your savings for an extended period, usually between one and five years.

Until recently, savers could earn a market-leading 5% for three months, but the best offer is 4.5% from Investec on a one-year term. Interest is paid at maturity, and minimum investment of £5,000 is required.

LHV Bank on a one-year term. Interest is paid at maturity, and a minimum investment of £1,000 is required.

GB Bank via investment platform Prosper has a 4.5% one-year deal. Interest is paid monthly or at maturity, and you can invest from £20,000 to £100,000.

LVH Bank pays 4.46% on a one-year deal. Interest is paid at maturity, and you can invest anywhere from £1,000 to £1,000,000.

Online banks typically offer higher rates than traditional bricks-and-mortar branches, which translate into better returns, giving you a more efficient way to save and reach financial goals.

If you prefer to go with a familiar name, the high-street lenders have slightly lower offers, but are still above inflation.

Tesco (TSCO.L) Bank offers the highest rate among high-street lenders, with a one-year fixed-rate savings account that pays 4.21% annually, with the minimum balance required being £2,000. However, you can invest up to £5m.

NatWest (NWG.L) has a fixed-term savings account offering 3.7% for one year. The minimum deposit is just £1 and interest will be paid on the first business day of every month and on the maturity date.

Unlike easy-access products, where interest rates can vary, fixed-rate accounts earn a set rate of interest for the period you choose, whether that’s six months or several years. Those are the most common deals, but some offers go up to 10 years and over.

You must leave your initial deposit for a fixed period without making withdrawals. If you touch your money, you forfeit any interest.

Easy-access savings accounts let you withdraw your money without notice. With that ease of access come lower interest rates, but they are a good option for those who think they might need their money in a hurry.

Be aware that rates on these accounts are variable, which means they can go up or down. You will be notified of any change ahead of time.

Read more: Nationwide cuts mortgage rates as other lenders hold steady amid budget announcement

Monument launched a market-leading 4.51% deal but you do need at least £25,000 to open the account. Interest is paid monthly and you can invest up to £2m.

Chase (JPM) has a 4.5% offer for 12 months that you can access with just £1.

Cahoot has a 4.40% offer which you can open from £1 and save up to £2,000,000. If you were to put £1,000 in this account, your balance after 12 months would be £1,044.

There are even higher-paying easy-access accounts, but they are not for new customers. Santander’s (BNC.L) Edge Saver, for instance, offers 6%, but is only available to current account holders.

Can’t decide on whether you want to put your money away and not touch it for a long time or keep it accessible at all times? Maybe you should consider a notice savings account.

Notice savings accounts require you to give notice to your savings provider before you can withdraw your funds.

These are ideal for those who know when they might need their cash but don’t want to face the temptation of dipping into it at any time.

Read more: House prices in southern England dip for the first time in 18 months

You need to give the bank or building society a set advance warning before you can withdraw your money. It’s usually between 30 and 120 days, though this can be longer.

Oxbury almost completely dominates the table this week, including 4.55% on a 180-day deal and a 4.54% on 120 days.

Interest rates with notice accounts are variable, which means they could go up or down over time.

For those looking to make the most of their cash savings, regular savings accounts can offer 7.5% returns.

Most regular savings accounts require you to put money away each month with interest paid yearly. It is not uncommon for the offer to be available only to current customers.

Principality offers 7.5% in a six-month regular saver account. You open an account and pay in up to £200 each month. Interest is calculated on the money in the account each day and paid six months after opening.

Zopa pays 7.1% on monthly deposits of up to £300. Account holders also receive 2% AER interest on all balances and 2% cashback on bill payments and there is no minimum monthly deposit.

Progressive Building Society offers 7% on its regular savings account, allowing deposits of up to £300 a month.

Read more: What the budget means for your finances

The Co-operative Bank has a 7% deal for existing customers. Fixed for one year, you can save up to £250 per month and can skip months without penalties.

First Direct pays the same 7% but you can save £300 every month.

Every deal mentioned here is covered by the Financial Services Compensation Scheme, so you are protected up to £85,000 or double that if it’s a joint account.

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