Easy access saving accounts have suffered at the hands of rock bottom interest rates for a while now, but long term, fixed rate bonds are the latest accounts to experience a rate cut.
The average rates on five-year bonds has fallen to 1.65% according to Moneyfacts, down from 2.65% last year. The average rate paid in October 2011 was as high as 4.04%, highlighting the drastic slump in interest. The fall in the base rate and reduced competition In the marketplace is being attributed to such poor interest rates. The number of savings accounts available has fallen to the lowest amount since 2007 and there have been over 100 cuts to five-year bonds since the start of 2016.
We have previously looked at the decrease in high interest savings accounts and discussed the best options for those looking for a high rate of return. For more information on interest rate reductions and the best savings accounts, you can also read more on Moneyfacts.