Some average fixed savings rates, where funds must be "locked" away, have plummeted to their lowest in at least a year, according to a financial information website. Moneyfacts reported that the average rate for accounts requiring notice before access was just 4.21% at the beginning of this month, marking its lowest since October 2023. Notice Isa rates also dipped to 4.03%, the lowest since October 2023. Typically, accounts needing notice offer higher returns than easy access options, which permit immediate withdrawals.
The average easy access rate stood at 3.07% and the easy access Isa rate at 3.28% at the start of October. The one-year fixed bond rate dropped to 4.31%, its nadir since June 2023, while the average longer-term fixed bond rate descended to 3.93%, the lowest since March 2023; these longer-term accounts are those exceeding 550 days.
One-year fixed Isa rates fell to 4.18%, the lowest since June 2023, and longer-term fixed Isas to 3.88%, the lowest since April 2023. Finance expert Rachel Springall from Moneyfacts commented: "Savers looking to secure a guaranteed return may be disappointed to see average fixed rates on bonds and cash Isas drop to their lowest levels in over a year.
"Despite the rate cuts, product choice remains resilient across the market. The average shelf-life of a fixed-rate bond rose to 57 days, up from 51 in September, its highest level since March 2022. As we draw nearer to the end of the year, now is a crucial time for savers to review their existing portfolio.
