A higher interest rate savings account will be one that has higher interest rates than most of the other alternatives. Average interest rates can very depending on the economic climate, and can go up and down. So, what may seem like a relatively low interest rate may in fact be quite high relative to other alternative saving accounts.
To find high interest saving accounts you should consider what the average interest rate may be. Visit a variety of branches and you can likely check what their saving accounts interest rates are with account leaflets and details. Note their saving account rates down onto paper, and then compare the various interest rates. If the saving accounts are not ISA saving accounts, you should note down the lower net rate.
The best savings accounts for higher than average interest rates are usually fixed interest savings accounts. Fixed interest saving accounts have interest rates that remain fixed. Fixed interest savings accounts can have rates more like 4 – 5%, or possibly even higher than this. These are the accounts which may require that no withdrawals are more for a period of one or two years. However, with higher interest rates they are a good alternative to variable interest rate accounts which usually have lower than average interest rates.
For example, Halifax currently have some of the best fixed rate ISA accounts. The Halifax fixed rate ISA accounts currently have interest rates varying from 4.25% – 4.5%. At the time of writing, these are among the best saving account interest rates. The disadvantage is that they have a 3 – 5 year term period.
The other alternatives are shorter term saving accounts that have interest rate bonuses. These are the usually the variable interest rate saving accounts. Saving accounts that have 1% or 2% bonuses usually have higher interest rates for the first year at least. The bonuses can inflate the figure up to 3 – 4%. Natwest and Barclays have saving accounts along those lines at the moment. However, once the bonus period ends the interest rate will drop quite a bit. Nevertheless, they are a short term alternative to fixed interest saving accounts.
So overall, Natwest, Barclays and Halifax are three banks that have saving accounts with higher than average interest rates. These include their fixed rate accounts which have the best interest rates, and also their saving accounts that have interest rate bonuses.