Savings rates are finally on the rise following years of pitifully low returns on your cash.
This is one positive side effect of interest rates creeping up, with the Bank of England having hiked its base rate to 2.25% last month.
But savings rates are of course still outstripped by soaring inflation, which is currently at a 40-year-high of 9.9%.
This just means now more than ever, it is important to get the most out of your money where you can.
The top savings rate on a fixed account has just breached 5%, while the best-paying easy-access account currently sits at 2.75%.
We run through the best deals right now - although savers should be warned that rates are changing rapidly.
When picking a savings account, make sure the bank or building society is covered by the Financial Service Compensation Scheme (FSCS) which protects up to £85,000 of your money if a provider goes bust.
The personal savings allowance - how much you can earn tax-free each year - is £1,000 for basic-rate taxpayers.
For higher-rate taxpayers, the allowance is £500.
Best easy-access savings accounts
Easy-access savings accounts allow you to withdraw your money when you want - although some providers do limit how many withdrawals you can make a year.
This is good for those who may need to dip into their savings - although the rates aren’t as good as fixed accounts.
The top-paying standard easy-access accounts right now at the time of writing (November 14) are:
- Santander - 2.75% (must open by November 1 - minimum deposit £1)
- Cynergy Bank - 2.75% (includes 0.15% AER bonus for the first 12 months - minimum deposit £1)
- Zopa - 2.15% (minimum deposit £1)
However, there are ways to get a better rate - depending on how much money you have to put away.
Barclays' Rainy Day Saver offers a rate of 5.12% but you need to an existing customer and you can only deposit up to £5,000.
The Nationwide FlexDirect current account pays 5% interest fixed for one year for new customers - but only on up to £1,500.
You also need to pay in at least £1,000 a month to get this rate and it falls to 0.25% after one year.
Best notice savings accounts
Like the name suggests, these accounts require you to give notice when you want to withdraw your money.
The top-paying notice accounts right now are:
- Oxbury Bank: 2.75% (180 days notice - minimum deposit £1,000)
- OakNorth Bank: 2.73% (180 days notice - minimum deposit £1)
OakNorth Bank: 2.71% (90 days notice - minimum deposit £1)
Best fixed-rate savings accounts
Fixed-rate accounts don't normally allow you to withdraw your money until the end of the term - not ideal for households who may need to access their funds.
You do get a return compared to easy-access accounts, but as rates are expected to keep rising, it might be a good idea not to fix for too long.
The top-paying fixed accounts right now are:
- Kent Reliance: 4.45% (one year fixed - minimum deposit £1,000)
- Kent Reliance: 4.75% (two year fixed - minimum deposit £1,000)
- Coventry Building Society: 4.85% (three year fixed - minimum deposit £1)
- Atom Bank: 5% (five year fixed - minimum deposit £50)
SmartSave is offering slightly higher rates on its three and five year fixed accounts, at 4.86% and 5.01% respectively, but the minimum deposit is £10,000.
Best ISA savings rates
ISA stands for Individual Savings Account.
Each year, you can deposit £20,000 into an ISA and you don't pay tax on the interest.
The rates on these savings products have been improving in recent years, although you can still get better rates elsewhere.
The top-paying easy-access cash ISAs right now are:
- Coventry Building Society - 2.25% (minimum deposit £1)
Tipton & Coseley - 2.25% on £25,000 and above; 2.1% on £10,000 and above; or 1.95% between £1,000 and £9,999
Cynergy Bank - 2.15% (minimum deposit £1)
The top-paying fixed-rate ISAs right now are:
- Kent Reliance - 3.85% (one year fixed - minimum deposit £1,000)
- Santander - 3.7% and claim £50 e-voucher if transferring £10,000 (one year fixed - minimum deposit £500)
- Kent Reliance - 4.3% (two year fixed - minimum deposit £1,000)
- Virgin Money - 4.35% (three year fixed - minimum deposit £1)
- Furness Building Society - 4.2% (five year fixed - minimum deposit £1,000)
Savings in tax-free accounts like ISAs do not count towards your personal allowance.
