Best savings accounts for 2025
No matter what your reasons for saving might be - whether it's for a house, a holiday, or as a precaution against unexpected expenses - you'll want to ensure your money gets the maximum return.
Looking for a bank account with a more competitive interest rate could make a significant difference.
For instance, the Punjab National Bank has the lowest returns, with its savings account offering a return of 0.75pc. An individual with £50,000 in this account will earn approximately £376.29 in interest per year. By transferring the deposit to the best easy access account from Atom Bank, which pays 4.85pc, one would gain £2,479.64 in interest annually, a difference of £2,103.35 more.
To ensure you make the most of your savings, The Telegraph has put together the current best rates available for bonds, savings accounts, Isas and current accounts, utilising data from market analyst Moneyfacts.
In this article, we will be covering:
- The best fixed-rate bonds
- The savviest rates for variable savings accounts
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- The best Isa rates
- Selecting the Appropriate Account for Your Needs
A savings account is a type of bank account that allows you to deposit money that you don't currently need for immediate use, with the intention of keeping it safe and allowing it to grow over time.
Unlike a current account, which you'll use to pay your bills and for everyday spending, a savings account is designed to be the place where you can put your spare money away, where it will hopefully grow over time.
There are several different types of savings accounts - some offer fluctuating interest rates, which can alter at any moment, while others necessitate you to commit to locking your money away for a specified length of time.
In theory, the more inconvenient an account is to manage, the more interest you should earn, but this isn't always true.
The best fixed-rate bonds for 2025
Fixed-rate bonds usually offer the highest returns available, but at present, several types of variable accounts – including the top-rate easy-access account – can match or even beat these rates.
Savers need to consider whether to opt for a fixed rate deal so they can be certain of getting a set interest for a longer period, or if they're prepared to take a risk and go for a variable rate and hope that it isn't suddenly reduced.
We have evaluated the leading bond accounts for different maturities:
One-year fixed rate
Vida Savings 1 Year Fixed Rate Account – 4.77%
You'll need to pay at least £100 as a deposit to open the account. You can decide to receive interest either on a monthly or annual basis.
Two-year fixed rate
Close Brothers 2 Year Fixed Rate Savings – 4.7 pc
This account has a minimum opening balance of £10,000 and pays annual interest.
Five-year fixed rate
JN Bank 5 Year Fixed Rate Account – 4.8 per cent
You must save at least £100 in this account. Interest is paid on this account annually on its anniversary date.
The top variable rate savings accounts for 2025
Variable-rate accounts generally offer greater flexibility than fixed-rate deals; you can typically make as many withdrawals as you like without losing interest, although some particular deals have their own restrictions.
In general, easy access accounts let you withdraw money as needed; regular saver accounts require you to make regular deposits; notice accounts allow withdrawals, but only if you give your provider a certain amount of notice beforehand.
Easy-access savings account
Chase Saver with a boosted rate account – 5 per cent
For new Chase current account customers, you can earn 5% interest for six months with the Chase Saver with a boosted rate account. You'll need to open this account within the first 31 days of holding your Chase account, and the rate will be enhanced by a further 1.5% on top of the standard interest rate, currently at 5%.
For a current account with no additional rate, the highest rate on offer is provided by Atom Bank, returning 4.85 per cent.
The account can be opened for £1. The quoted rate will apply if no withdrawals are made in a month; however, if you withdraw money, the rate will fall to 3.25% for that month.
Regular savings account
Principality Building Society Regular Saver Account - 8%
This account is valid for a six month period and can be obtained with just £1. You can pay in a maximum of £200 per month, and any withdrawals during this time are not allowed. The interest is paid out at the end of the term.
Notice savings account
London and Middle East Bank 90-Day Notice Account – 4.94% nostrac
A minimum deposit of £10,000 is required. You must provide 90 days' notice prior to making a withdrawal or closing the account. Interest is paid on a quarterly basis.
The current market rates for instant-access savings accounts in the UK.
On occasion, current accounts may pay interest on the balance they hold, which can be convenient if you prefer not to bother with transferring money between multiple accounts.
We've discovered that Nationwide provides the current account with the highest interest rate at present.
Nationwide FlexDirect Current Account – 5%
Interest is paid on balances of up to £1,500, but only for the initial 12 months. On top of that, you need to make at least £1,000 deposit into the account each month.
The best ISA rate forecast for 2025
Work in a similar way to savings accounts, except all interest you earn is tax-free – and you’re restricted to putting by up to £20,000 in each tax year.
Easy-access cash Isa
Moneybox Cash Isa – 5.11%
New savers can open this account with £500 and earn 5.11pc for the first 12 months, including a 0.66pc bonus rate. After the first year, the bonus will be taken off. Interest is paid on the account's anniversary.
One-year fixed rate
Close Brothers Savings 1-Year Fixed Rate Cash Isa – 4.55%
Opening an account necessitates an initial investment of £10,000. Maturity of the bond results in payment of interest.
Two-year fixed rate
Shawbrook Bank 2-Year Fixed-Rate Cash ISA – 4.47%
The minimum deposit is £1,000. Interest is paid on the anniversary of the account.
Three-year fixed rate
Shawbrook Bank 3-Year Fixed-Rate Cash ISA - 4.42pc
An account can be opened with a minimum of £1,000. The account earns interest, paid out once a year, on the anniversary of the account being opened.
What's currently happening with savings rates?
Hundreds of savings accounts currently offer a higher interest rate than the rate of inflation, which was 2.5pc, a slight reduction from the 2.6pc rise seen in November, as per the latest figures from the Office for National Statistics.
Savings rates have been steadily falling since the Bank Rate reached a peak of 5.25% last year, and the latest cut down to 4.75% in November is accelerating the trend.
As a result, individuals seeking to secure a lucrative account may need to act quickly as top-rated ones don't often remain available for long.
Emily Haine, of the online investment firm Bestinvest by Evelyn Partners, states: “At present, the highest savings rates are continuing to outstrip inflation, allowing savers who searched for the top deals a healthy real return on their savings. Securing a top rate at the moment before the best offers diminish could be a prudent approach for those with cash sitting in an account that is providing disappointing returns, in order that their money works as efficiently as possible.”
Make use of our calculator to find out how much your savings account is bringing you in - and how much more interest you could receive if you made a change.
What are the main differences between an ISA, a bond, savings account, and a current account?
A current account is a type of bank account that usually doesn't earn any interest but does offer a lot of flexibility when it comes to how often you're able to access your money.
With a savings account, the bank provides you with an interest payment in exchange for keeping your money, yet places some constraints on the number of withdrawals you're allowed to make.
A fixed-rate bond is a type of savings account with a set term, usually between one and five years long. Until the end of the bond's fixed term, you can't withdraw your money, but you will typically earn a higher interest rate for putting a block on your funds.
The main distinction between an Isa and other savings accounts is that there is no tax levied on the interest. Anyone can save up to £20,000 per year tax-free within an Isa.
Choosing the right current account for you
The first aspect to consider is whether you should have access to the funds in case of an unforeseen emergency. A current account or a savings account with easy access will give you this flexibility.
However, you'll likely earn a better rate if you're prepared to lock your money away for a set period – for instance, in a bond. Typically, the longer the period you commit to, the higher the rate you'll get – though that's not the situation right now. Fixed-rate accounts with one and two-year terms currently offer higher rates than those with five-year rates.
Also, think about whether you may have to pay income tax on any interest earned outside of an Isa. This is £1,000 for individuals paying basic-rate tax and £500 for those paying higher-rate tax. If you earn more than these amounts outside of an Isa, then income tax will be due.
To figure out whether it's possible to exceed your allowance and if you should invest in an individual savings account.
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