Find higher yield easy- access accounts

Savers need to move their easy-access money into a decent account, now. The difference between the best and worst accounts is widening to such as extent that you can earn nearly £130 extra interest on each £10,000.

Rates are rising on these accounts as new banks and building societies compete for a position among the best rates.

This is a marked turnaround from their previous behaviour when they limited their jostling for the top slot on fixed-rate bonds. But now, with the first sniff of the Bank of England base rate rising from its historic low of 0.25 per cent, the focus has shifted to easy-access accounts.

And the rate rises are bigger than on fixed-rate accounts. In June, the top fixed rate one-year bond paid 1.8 per cent – the same level as now from Atom Bank. For two years the best deal was 2.01 per cent, a whisker below the best deal now at 2.05 per cent, from Atom, Paragon and Harrods Bank.

But the best easy-access account rate has climbed from 1.1 per cent to 1.3 per cent over the same period. Last month the average rise on easy access accounts was 0.34 percentage points, nearly double the 0.18 points on one-year fixed rate bonds.

High yielding accounts can earn  investors up to £130 extra interest on each £10,000

 High yielding accounts can earn  investors up to £130 extra interest on each £10,000 

Charlotte Nelson, finance expert at data analysts Moneyfacts says: ‘Savers are finally seeing some positive news not just with fixed-rates but easy-access rates, too. Fixed rate bonds have increased by small increments over time. Providers have increased rates on their easy-access accounts far more steeply and quickly.’

The top deal is now 1.3 per cent from French-owned RCI Bank, which upped the rate on its internet-based Freedom Account on Friday.

The next is 1.27 per cent from Kent Reliance Easy Access 21, available through its eight branches as well as by post and online, which increased from 1.15 per cent last week.

Ford Money also upped the rate on its Flexible Saver to 1.17 per cent last week.

It automatically pays the higher rate to both existing and new savers. If you are sitting in NatWest Instant Saver or HSBC Flexible Saver – which, at 0.01 , per cent they pay you just £1 interest a year to borrow your £10,000 – you can increase your interest to £130 by switching.

Halifax Instant Saver, Barclays Everyday Saver and Lloyds Easy Saver hardly pay any more at £5 a year (0.05 per cent) and Santander £10 (0.1 per cent). It is these poor paying accounts where you could find you don’t benefit from the full rise in base rate.

When rates start to rise, providers hope you won’t notice that yours hasn’t kept up.

Tom Adams, head of research at advice firm Savings Champion, says: ‘The link between Bank of England base rate and how much savers earn is severed. There is no guarantee that providers will match any rise in base rate on their variable accounts. And you could see no increase at all in old accounts closed to new savers.’

He adds: ‘Even if the big banks pass on the whole rise, they will still be poor value as they have cut their rates to the bone. You need to act quickly to get the best deals. They don’t last long.’

At the end of September, Charter Savings Bank launched its Easy Access 6 at a then-top rate of 1.26 per cent. It was on sale for just 13 days before closing to new savers last week.

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