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This comparison simply includes all savings accounts.

Habib Bank Zurich
Fixed Rate Bond Habib Bank Zurich
Min deposit £1000
Term 1 Year
Interest AER 1.85%

Why we like it: Minimum deposit £1000. No withdrawals permitted. Apply online. Eligible deposits covered by UK FSCS.

Masthaven Bank
Flexible Term Saver Masthaven Bank
Min deposit £500
Term 30 Months
Interest AER 2.11%

Why we like it: 30 month term. Interest can be paid monthly or annually. Minimum deposit £500, Maximum deposit £250,000. No withdrawals permitted. FSCS Protected

RCI Bank
Fixed Rate Bond RCI Bank
Min deposit £1000
Term 3 Years
Interest AER 2.31%

Why we like it: Save from £1,000 to £1,000,000. No withdrawals before the end of the term. RCI Bank are protected up to a total of €100,000 by the FGDR (Fonds de Garantie Dépôts et de Résolution), the French deposit protection scheme. Apply online.

Fixed Rate Bond Vanquis
Min deposit £1000
Term 4 Years
Interest AER 2.52%

Why we like it: Minimum deposit £1,000. Interest paid monthly or annually. Apply online. Eligible deposits covered by UK FSCS.

Fixed Rate Bond Vanquis
Min deposit £1000
Term 5 Years
Interest AER 2.70%

Why we like it: Minimum deposit £1,000. Interest paid monthly or annually. Apply online. Eligible deposits covered by UK FSCS.

Fixed rate bonds offer the opportunity to receive rates higher interest in exchange for tying up your savings for a prolonged period of time. Most banks offer a range of fixed rate bonds, usually from 1 year2 years3 years or 5 years. It should be noted that longer fixed rate bonds offer the highest interest.

The government introduced a bespoke type of fixed rate bond in January 2015, which was specifically designed for those over 65. This special fixed rate bond, often referred to as the pensioner bond, was provided as an attempt to encourage more people to save money for their retirement.  The bond itself was competitive: the one year bond had an interest rate of 2.8% and the three year bond offered 4% interest.

The pensioner bond had a minimum deposit of £500 and a maximum deposit of £10,000. The bond was rigid with its terms and conditions, as there was no cooling off period at the beginning of the bond. Unlike other fixed rate bonds, where you are sometimes offered a short period of time at the beginning of the fixed term to change your deposit, with the pensioner bond the decision to deposit your money was final. If you wanted to withdraw any savings from the fixed rate bond within the fixed term, you incurred a penalty equal to 90 days’ of interest.

No more pensioner fixed rate bonds 

The pensioner fixed rate bond is no longer available. Therefore, if you receive a pension and you wish to put some money aside in a fixed rate bond then you should consider the other bonds on the market.

Fixed rate bonds available

A summary of the best fixed rate bonds are found in the table above. However, it is important to bear in mind that if you deposit your savings into a fixed rate bond, you will not be able to make a withdrawal until maturity. Although there are some banks that allow early withdrawals, they will usually need written notice and they will often charge a potentially large penalty.

Latest news

Pensioner Bond Maturity - 5 Ideas For Your Cash

From January 2018 over 900,000 people who invested in pensioner bonds will start to see their bonds mature. Savers who have been enjoying 4% pa are going to get a shock when they look for comparable returns from cash in the current market. We have put together 5 ideas for your cash in 2018

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