2 yr fixed bond. Best rate for £85k investment

Monkeymumma76

Hi all, I’m a newbie here. Looking to re-invest £85k (my current bank is Lloyds and the rate is dreadful) 
Money is sat in a savings account doing nothing and looking for the best rate possible and obviously the safest! 

Thanks in advance. 

Ayr_Rage

Do your research on a site such as this

https://moneyfactscompare.co.uk/

DRS1

Why pick 2 years?  I may be wrong but 1 and 3 year bonds look like they beat 2 year ones.

refluxer

Monkeymumma76 said:

Hi all, I’m a newbie here. Looking to re-invest £85k (my current bank is Lloyds and the rate is dreadful) 
Money is sat in a savings account doing nothing and looking for the best rate possible and obviously the safest! 

Thanks in advance. 

Have a look at the comparison tables on MSE here, plus the moneyfactscompare site linked to above is a good, more comprehensive comparison site to compare rates - just make sure you sort by 'Rate' to put them in rate order, otherwise banks who pay to advertise on the site get bumped to the top in the default view ('Provider links first'). If you do that with the 2 year fixed rate accounts table, you'll get a list which looks like this.

A few things to bear in mind...

Firstly - FSCS protection will only give you cover for £85k per financial institution and that includes any interest due on the account, so it wouldn't be wise to put the full £85k into a fixed rate account with one bank, as 2 year's-worth of interest added to that would obviously take you well-over that limit... unless you're looking to have the interest paid out every month ? If you're wanting interest paid into the account, it would be sensible to split the money to bring yourself well under the limit, taking into account any other accounts you might have with that bank (and any associated banks). If you're not familiar with the subject of the FSCS, MSE have a guide : https://www.moneysavingexpert.com/savings/safe-savings/

And second - in a (non-ISA) fixed rate account, you usually can't withdraw the money for any reason except for death or a critical illness, so make sure you're sure that you won't need access to whatever you lock away.

refluxer

DRS1 said:

Why pick 2 years?  I may be wrong but 1 and 3 year bonds look like they beat 2 year ones.

The best 1-3 year bonds look to all be paying around the same rate (4.43% - 4.45%) at the moment, according to moneyfactscompare.

Bigwheels1111

I know 85k is covered by FSCS, but only 85k.

What about the interest ?.

Put 80k max in one account, if interest is paid away, less if compounded.

Monkeymumma76

Thank you everyone x yes I did think about the interest taking me over the 85k so will need a rethink on that. Has anyone had any experience with RCI Bank as they seem to be offering the best rate? 

Also with cash ISA my limit is only 20k … so put 65k into a yr bond maybe? I just feel so lost and trying to deal with lots of other ‘life’ stuff at present-need someone to help me!! Thanks for advice so far x 

Pompeydave1967

Atom fixed rates 1-5 years not bad at the moment , easy app , monthly / yearly interest .
Option to change interest preferences during term as well .
No problems for me with Atom , been with them for years and currently hold 10 accounts with them.

Cisco001

Monkeymumma76 said:

Thank you everyone x yes I did think about the interest taking me over the 85k so will need a rethink on that. Has anyone had any experience with RCI Bank as they seem to be offering the best rate? 

Also with cash ISA my limit is only 20k … so put 65k into a yr bond maybe? I just feel so lost and trying to deal with lots of other ‘life’ stuff at present-need someone to help me!! Thanks for advice so far x 

Cash isa current tax year £20k

9 months fix - £20k (move to cash isa april 2026 if we still have £20k allowance)

£45k for 2 years bond

Oxbury bank 2 years fix is 4.4%

littlemissbossy

Monkeymumma76 said:

Thank you everyone x yes I did think about the interest taking me over the 85k so will need a rethink on that. Has anyone had any experience with RCI Bank as they seem to be offering the best rate? 

Also with cash ISA my limit is only 20k … so put 65k into a yr bond maybe? I just feel so lost and trying to deal with lots of other ‘life’ stuff at present-need someone to help me!! Thanks for advice so far x 

Yes, I’ve just RCI for quite a while, all good. 

refluxer

Monkeymumma76 said:

Has anyone had any experience with RCI Bank as they seem to be offering the best rate? 

Also with cash ISA my limit is only 20k … so put 65k into a yr bond maybe? I just feel so lost and trying to deal with lots of other ‘life’ stuff at present-need someone to help me!! Thanks for advice so far x 

If you expect to be paying tax on your savings interest, then yes - putting £20k into a cash ISA now (and then another £20 next April 6th) would be sensible. (Note that if you're a low-earner, then you can earn up to £18,570 in combined income from a salary, pension and savings interest - see the MSE guide here for more details)

RCI aren't actually paying the best rate for a 2 year bond at the moment although they're not too far behind, admittedly. The reason they appear at the top of the Moneyfactscompare table is because they pay for a direct link on the site. As I mentioned above, if you sort the list by 'Rate' using the filters at the top of the page, you'll see the accounts in rate order - JN Bank are current the top at 4.45%.

Of the top 2-year bond accounts currently listed, I have used Oxbury and Atom and would have no hesitation is recommending either of them. Oxbury's online banking site is great and they often have accounts with good rates for existing customers than aren't available to non-customers. Atom are an app-only bank and have one of the slickest banking apps around - I've had a number of fixed rate accounts with them in recent years and not had a single issue.