Fixed rate bonds are still one of the best ways to secure a decent return on your cash, but the thought of locking your money away for years on end can understandably be daunting. A suitable compromise could be a three-year bond.
Take a look at the best savings rates and you'll see that there are plenty of medium-term accounts that can help secure growth-generating rates, and three years could be the ideal term. Your returns are guaranteed too, unlike with a variable rate account. However, it's important to be aware of the restrictions.
In particular, most fixed rate bonds won't allow you to make further additions or access your funds early – and if they do they could penalise you heavily – so you'll need to be confident you won't need your chosen investment for the full three years.
You also need to make absolutely certain that you're choosing the best savings account for your needs, and we're happy to help with that! Here are the current top six three-year bonds that could help you secure a decent return.
RCI Bank takes top spot with a rate of 2.31% paid on a minimum investment of £1,000. The flexibility to add funds for a short time could prove tempting, but the lack of access to funds should be borne in mind.
Vanquis Bank sits in second place with a bond that pays 2.30% from a minimum deposit of £1,000. While you'll have to give up access for the entire term, it could be worth it to secure this rate.
Next up is BLME with this three-year bond, which pays an expected profit rate of 2.30% AER to those with at least £25,000 to invest. It requires a linked BLME current account and, as with most other bonds, no further additions are permitted and withdrawals won't be allowed until the full term is up.
Ikano Bank secures fourth place with a bond that pays 2.26%, this time from a minimum investment of £1,000. Additional deposits are allowed for 14 days after opening, but as there are no withdrawals before maturity, savers will have to ensure they won't need their funds for the full three-year term.
In fifth place is Hodge Bank with a deal that pays 2.25% from a minimum of £1,000. While early access to funds is not allowed, there is some welcome flexibility in how the account can be opened and operated.
Completing the top six is Tandem Bank, which also pays 2.25% AER from £1,000. This time, however, neither additional deposits nor early access to funds are allowed, on a bond which must be opened online and then operated over the phone.
Information & Rates correct as at: 16.05.2018