The savings accounts with the best interest rates for 2025
Regardless of why you’re saving – for a house, a holiday, your children’s future or as a buffer to cover emergencies – you’ll want to make sure your money is working as hard as possible.
To help you get the most out of your savings, Telegraph Money today launches a range of live “best buy” tables showing the highest rates available across a variety of savings accounts. These tables update automatically every day, with data provided by Savings Data Limited.
Our tables of the best cash Isa rates – whether you want an easy-access, notice, fixed-rate or variable rate account – would be a good place to start for savers looking to make the most of their £20,000 “use or lose it” annual Isa allowance before it renews on April 6. We also list the best Lifetime Isas if you’re saving for a house or your retirement.
If you have already maxed out your Isa, or want to save outside of the tax-free wrapper, we track the best easy-access accounts and interest-paying current accounts.
Those who prefer to save monthly should refer to the table of top-paying regular savings accounts, while savers happy to lock their money up for longer in pursuit of higher returns could benefit from our lists of the best fixed-rate bonds and notice accounts.
We also track the best Junior cash Isas and the best children’s savings accounts for parents putting money away for their family’s futures.
In this article, we will cover:
Seeking out an account with a more competitive interest rate can make a huge difference.
For example, take a savings account paying a relatively low 0.75pc. A saver with £50,000 in this account will earn around £375 a year in interest. Moving the deposit to the best buy easy-access account from Tandem Bank, paying 4.9pc, would yield £2,450 a year, an extra £2,075.
Cash loses value over time if it is left in an account that pays less than the inflation rate. At the current inflation rate of 3pc, a pot of £1,000 left in a zero-interest account would be worth just £971 after a year, £863 after five years and as little as £744 after 10 years.
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 stash your spare money away, where it will hopefully grow over time.
There are several different types of savings accounts – some offer variable rates, which can change at any time, while some require you to commit to locking your cash away for a fixed amount of time.
In theory, the more inconvenient an account is, the more interest you should earn – but it’s not always the case.
Fixed-rate bonds tend to pay the highest rates on the market. Savers need to weigh up whether to take a fixed deal in order to get guaranteed interest for a longer term, or take a chance on a variable rate that could rise over the length of the term.
The best fixed rate currently available is a one-year business bond from Cambridge Building Society paying 5pc for a minimum deposit of £1,000.
Variable-rate accounts tend to come with more flexibility than fixed-rate deals; often, you can make as many withdrawals as you like without taking a hit on interest, but some specific deals have their own restrictions.
In general, easy-access accounts let you take out money whenever you like; regular saver accounts require you to make deposits regularly; while notice accounts allow you to make withdrawals, but only if you give your provider a prescribed amount of notice.
Tandem’s Instant Access Saver account pays 4.9pc with no minimum deposit.
A competitive 8pc is on offer from Principality Building Society. This account has a six-month term and can be opened with just £1. You can pay in up to £200 a month, and withdrawals during the term are not permitted. Interest is paid on maturity.
The 95-day Notice Pocket account from Plum pays 5.05pc. You need to give 95 days’ notice to withdraw your money. The account can be opened with just £1, although is only available to Plum Premium customers, which costs £9.99 per month.
In some cases, current accounts will pay interest on the balance of money they hold, which can be useful if you don’t want the hassle of transferring money between multiple accounts.
Nationwide’s FlexDirect Current Account pays 5pc. Interest is paid on balances of up to £1,500, and only for the first 12 months.
Cash Isas work in a similar way to savings accounts, except that all interest you earn is tax-free – and you’re restricted to depositing up to £20,000 in each tax year. Income tax is payable on savings interest earned outside of an Isa, above an allowance of £1,000 for a basic-rate taxpayer and £500 in the higher-rate band.
Monument Bank offers the highest-paying easy-access cash Isa, with a rate of 4.76pc on a minimum deposit of £10,000. Those with smaller cash piles can access a similar rate of 4.7pc with Principality Building Society, which asks for just £1.
If you have £3,000 and are willing to lock it away for a year, Lloyds Bank will offer you 4.5pc.
A smaller deposit of £1 could get you a one-year fixed rate of 4.41pc from Hampshire Trust Bank.
West Brom Building Society would need 60 days’ notice to release your cash, but pays 4.6pc with a £1 minimum deposit.
Savers who are under 40 and putting money away to buy a home or fund their retirement can open a Lifetime Isa. As well as the tax-free savings growth, the Government rewards savers with a bonus of 25pc, up to £1,000 a year.
The best rate currently available is from Tembo Money Limited, which pays 4.6pc for a minimum deposit of £1.
If you’re under the age of 18, or saving on behalf of a youngster, you can open a children’s account. Many account providers will let children add and withdraw money from the age of seven, so it can be a good way to teach financial skills early in life.
Halifax’s Kids’ Monthly Saver account requires a minimum deposit of £10 and a monthly deposit of between £10 and £100. It pays 5.5pc fixed for a year.
Children also get their own Isa allowance of £9,000 a year, which means an adult saving on behalf of a child can put this extra amount away on top of their own £20,000 allowance.
The top-paying Junior Isa is from Nottingham Building Society with a rate of 4.5pc.
Hundreds of savings accounts currently offer a rate that beats CPI inflation, which rose by 3pc in January, up from 2.5pc in December, according to the latest figures from the Office for National Statistics.
Savings have broadly been on a downward trajectory since they peaked in summer 2023. While higher inflation isn’t good news – since price rises eat into savings returns – it may mean the Bank of England is slower to reduce central interest rates, meaning savings rates could stay higher for longer.
That being said, some of the top rates are quick to disappear – so if you spot an account that looks good, you may need to act fast.
Alice Haine, of online investment platform Bestinvest by Evelyn Partners, says: “For now, the best savings rates are continuing to outstrip inflation, giving savers who hunted out the top deals a healthy real return on their nest eggs. Locking in a top rate now before the best deals disappear could be a sensible strategy for those with cash languishing in an account delivering dismal returns to ensure their money is working as hard as possible.”
Use our calculator to see how much your savings account is earning you – and how much more interest you could get if you switched.
A current account is a transactional account that typically pays no interest but gives you a lot of flexibility in how often you access your money.
With a savings account, the bank pays you interest for keeping your money and therefore imposes some restrictions on how many withdrawals you can make.
A fixed-rate bond is a savings account with a fixed term, usually between one and five years. Until the duration of the bond is up, you cannot withdraw your funds, but in exchange for the commitment you will typically benefit from a higher rate.
The difference between an Isa and other types of savings account is that there is no tax charged on the interest. Everyone can save up to £20,000 a year tax-free in an Isa, or £9,000 for children.
The first thing to consider is whether you might need access to the funds in an emergency. A current account or an easy-access savings account will give you this flexibility.
However, you will get a higher rate if you are willing to lock away your funds for a set period (for example, in a bond). Generally, the longer the period, the higher the rate – however, this is not the case at the moment. Fixed-rate accounts with one and two-year terms are far higher than those with five-year rates.
The other thing to consider is whether you are at risk of exceeding your personal savings allowance. This is £1,000 for a basic-rate taxpayer and £500 for a higher-rate taxpayer. If you earn more than this in interest outside of an Isa, then you will have to pay income tax.
Use our savings tax interest calculator to work out whether you could breach your allowance, and if you should get an Isa.
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