Fixed rate accounts with no withdrawal penalty

caliston

Given that things seem a bit jittery and possibly interest rates might drop, I'm interested in fixed rate accounts. But I can't commit to a term period without at least some flexibility. Most fixed rates are either inaccessible until the end of the term, or accessible with some huge penalty (like 120 days interest).

I've seen the Leeds Building Society Fixed Rate Postal Bond which is good, except it pays out interest on 30th June next year. This is going to be messy from a tax point of view - I need one with either monthly interest or maturity before 5th April. Any suggestions? Rate doesn't need to be great, just better than about 6%. I don't mind a small withdrawal penalty, but I'll probably want to withdraw in 6 months to a year.

Cheers!

isofa

All fixed rate bonds will have penalties for withdrawing money, you probably can find notice accounts such as 30, 60 or 120 day accounts with pretty good rates, and you then give that many days notice so save affecting the interest on a withdrawal, else, if you withdraw without notice, you loose 30, 60 or 120 days interest.

Have a look at https://www.moneysupermarket.com for listings.

I think you'd be better with a high-rate instant access account such as: ICICI, IceSave, Sainsburys etc.

caliston

But all of those would have variable rates would they not? I can't find Moneysupermarket listing any notice accounts with fixed rates. I've already got an instant access account.

There /are/ some fixed rate accounts without withdrawal penalties - Leeds is one. Found another: Scarborough BS Click and Save Issue 7, which I'm looking into.

isofa

Yes, that's the choice you have to make! You'll get a better rate, but only if you can tie your money up for a set period.

Nick_C

If you have some capital that you can guarantee to save for 6 months, look at 6 month fixed rate bonds. eg

Provider.......................................................Product...................................AER......Interest

Norwich & Peterborough Building Society.......Fixed Rate 6 Month Bond.......6.76%.....At maturity

Norwich & Peterborough Building Society.......Fixed Rate 6 Month Bond.......6.76%.....Monthly

Standard Life Bank.......................................6 Month Fixed Rate Bond.......6.75%.....At maturity

Standard Life Bank.......................................6 Month Fixed Rate Bond.......6.75%......Monthly

HalifaxWeb Saver.........................................6 Month Term........................6.71%......At maturity

Put the balance into B&B instant access savings account at 6.4%

from http://www.fsa.gov.uk/tables

regularsaver1

Halifax websaver also does 3 months