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Longer term savers 'are getting worst ever rates'

By Vicky Shaw

Savers locking their money into longer-term accounts in the hope of being paid more interest are facing the worst rates on record, it's been claimed.

The average rate on offer on a five-year fixed-rate savings bond has plunged to a "miserly" 2.28%, down from 2.50% a year ago and 2.56% in 2014, according to Moneyfacts.co.uk.

A similar trend has been found with five-year fixed-rate Isas. The average rate in this sector is now 1.98%, down from 2.20% a year ago and 2.59% two years ago.

Moneyfacts said the current average rates on these deals are the worst it has seen, based on its records going back to 2008.

It said even longer-term deals in the "best buy" tables now offer returns of less than 3% - showing the need for savers to act quickly if they see a good deal.

A new personal savings allowance was introduced on April 6, taking most people out of paying any tax on their savings interest.

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