Fixed rate bonds are a type of savings account that pay a guaranteed rate of interest. You pay in a lump sum that’s held for a set amount of time, called a term. The interest rate will stay the same for the term of the account.
How do fixed rate bonds work?
Fixed rate bonds are accounts that are fixed for a period of time. Bonds with a fixed term can mean a higher rate of interest.
The interest rate will remain the same from when you open the account to the end of the agreed period. This makes fixed rate bonds an option for people who don’t need to access to their money for a while. The interest can either paid monthly or annually.
How much can I pay into a fixed rate bond?
For most fixed rate bonds, there is a minimum amount of money you will need to pay in to open it.
The top limit you can pay into a bond is usually high, up to a few million (our top limit is £2m).
The first £85,000 placed into the account will be protected by the FSCS.
How much you need to open a bond or the top amount you can pay in will depend on the provider and account you choose.