Fixed-rate savings accounts are currently offering their highest returns in several years, with some paying up to 5.25%. This presents savers with a difficult choice: whether to lock in these attractive rates now or wait for potentially even better offers, as economists expect the Bank of England to raise its base rate before the end of 2026 and further rises are predicted for 2027.

The average one-year fixed bond currently pays 4.41%, though premium accounts offer higher rates such as 5.05% to 5.06% for one-year terms and 5.25% for five-year bonds. Whilst rates of 6% were available as recently as late 2023, financial experts expect further base rate increases could push savings returns even higher. Advisers recommend a balanced approach—splitting savings between fixed bonds and easy access accounts (which also pay up to 5%), and maximising tax-free ISAs, particularly given upcoming rule changes in April 2027 that will cap cash ISA contributions at £12,000 for those under 65.