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How to get a savings account above 6%

Switching current accounts could unlock an impressive interest rate on your savings

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Alongside attractive switching offers, banks are offering higher rate linked savings accounts

It’s not a big secret that rates on savings accounts are slowly decreasing. 

Last year, savings accounts were on a high with rates above 6% on some fixed-rate accounts. But this couldn’t last forever, as the economic climate changed. Inflation fell to 3.9% in November and the Bank of England continued to freeze the base rate at 5.25%. 

These factors impacted savings rates, and we’ve seen the average monthly rate for savings accounts drop to 4.1% in January compared to 4.6% in September, 2023. 

Looking at the savings account market for all customers, the top interest rate for an easy access account stands at 5.22% with Metro Bank’s instant access savings account. Whereas for fixed-rate accounts, Investec has a one-year fixed-rate saver at 5.30%. 

These rates are definitely still competitive and will help savers to earn some extra money on their cash. However, if you are keen to find the top rates, then you might need to look closer to home. 

Big banks like Nationwide, First Direct and TSB are all offering savings accounts with an interest rate at 6% or above. 

But, there’s a catch. These accounts are for existing customers only or for people that decide to switch their current account. Alongside attractive switching offers, banks are also trying to get more customers by offering these higher rate linked savings accounts. 

For example, TSB is currently offering a switching offer of up to £185* with its Spend & Save account. This is an everyday current account with optional features and no account fee. The switching offer allows a customer to earn £125 when they apply for a Spend & Save or Spend & Save Plus account, and there’s an opportunity for up to £60 in double cashback. Remember to read all the terms and conditions before making the switch. 

The good news is that TSB customers will then get access to its monthly saver account. This has an interest rate of 6% which is fixed for one year. You’ll be able to save between £25 and £250 each month via a standing order and there are no withdrawal charges. 

New bank account deals are offered all the time, so compare bank accounts and see if there is an account that works for you.

Similarly, First Direct is offering a switching offer of £175* cashback when someone switches to its 1st Account and deposits £1,000 into the account. This current account then unlocks access to a 7% regular savings account. This interest rate is fixed for 12 months and you can save between £25 and £300 a month into the account. The regular saver is also flexible as you can change the amount you deposit at any time, which works well for different budgeting demands. Plus, although you are restricted with how much you can save each month, the interest adds up - if you save £300 every month for 12 months at this rate, you’ll earn around £136.50 in interest. 

Elsewhere, Nationwide has gone one step further, as it is offering its current account members a Flex Regular Saver with an interest rate of 8%. Bear in mind that this rate is variable, so it could change throughout the year. This regular saver also has some restrictions as you can only save up to £200 a month, and there are only three withdrawals allowed during the year before the interest drops to 2.15%. But, if you stick to the rules, this regular saver will certainly maximise the interest on your savings. 

Overall, the accounts mentioned above show there are still some good offers within the savings account market, but you’ll need to do your research to get the best deal. Plus, there’s never been a better time to save little and often, as this is where the high interest rates can be found. 

*Ts and Cs apply

Help stretch your budget a little further by making the most of your savings.

About Lucinda O'Brien

As a trained journalist, Lucinda has spent the past 10 years writing and editing content for regional and national titles, including The Mirror, WalesOnline and Manchester Evening News. She is now a personal finance editor and specialises in savings, helping people to make confident financial decisions so they can save for what matters most.

View Lucinda O'Brien's full biography here or visit the money.co.uk press centre for our latest news.