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Could a Black Friday bond give you the best savings rate?

Furness Building Society has launched a new savings account for Black Friday, but is it a table-topper?

Black Friday has become one the biggest sales events of the year, and now even banks and building societies are getting in on the action. 

Furness Building Society has launched a ‘Black Friday’ two-year bond offering 1.75% AER – but is this ‘special offer’ actually a good deal?

Which? looks at how the offers stack up and whether you can get a better rate elsewhere.

Black Friday savings bond

In the lead-up to Black Friday, Furness Building Society has launched a two-year fixed-rate bond paying 1.75% AER. Interest is paid annually, on the anniversary of the account opening, but there are a few caveats.

No withdrawals or closures are allowed within the two-year term. You’ll also need to pay in a minimum of £1,000 on opening the account and can’t make any additional deposits during the term.

Plus, there’s no online access; the account can only be opened at a Furness branch (all of which are located in North West England).

Best two-year fixed-rate deals

If you’re willing to lock your money away for two years, you might be able to find a better rate from a different provider.

The Al Rayan Bank 24-Month Fixed-Term Deposit offers an expected profit rate of 2.32% AER if the payment is annual, or 2.3% if it’s quarterly. This is not an interest rate per se, it’s the return the bank expects to provide you at the end of the term. If this rate were to change, the bank would notify you and give you the chance to withdraw your funds.

Meanwhile, the OakNorth Bank 30-Month Fixed-Term Deposit offers an interest rate of 2.31% AER. You’ll need a minimum deposit of £1,000 and your money will be locked away for two-and-a-half years. In addition, you should be aware that there’s no branch network and this account can only be opened online.

The best two-year fixed-rate deals currently available are:

Account AER Minimum investment
Al Rayan Bank 24-Month Fixed-Term Deposit 2.3% or 2.32% £1,000
OakNorth Bank 30-Month Fixed-Term Deposit 2.31% £1,000
Charter Savings Account 2-Year Fixed-Rate Bond 2.3% £1,000
OakNorth Bank 24-Month Bond 2.3% £1,000

Sources: Moneyfacts, Which? Money Compare

Could you lock your money away for longer?

Before opting for a fixed-term bond, you should think seriously about whether you’ll need access to your money during that period. Usually, you won’t be able to make withdrawals before the fixed period is up, even if you find yourself in financial dire straits.

On the flipside, the longer you commit your money, the more you’re likely to earn.

If you can stretch to a three-year fixed-term account, you could earn as much as 2.41% AER from Secure Trust Bank, or 2.4% AER from Al Rayan Bank or Tandem Bank.

Alternatively, if you can commit to five years, Secure Trust Bank offers interest of 2.71% AER.

How to find the best savings account

Savings providers will often try to stand out from the crowd by offering something a little different – for example, the Poppy bonds launched by Coventry Building Society in the lead-up to Remembrance Day.

But while these initiatives might be eye-catching, it’s important to look beyond the gimmicks and make sure the account will give you the best return for your money.

Shopping around is important, as even accounts with similar interest may have very different terms and conditions. You can compare hundreds of savings accounts and Isas based on customer service as well as rates on Which? Money Compare.

As well as the interest rate, you should weigh up:

  • How often is the interest paid?
  • Is the interest paid away (meaning it goes to a separate account), or is it compounding, meaning you earn interest on the interest?
  • How long can you afford to lock away your cash?
  • Do you need an Isa tax-free wrapper or will the interest you earn be below the personal savings allowance of £2,000?
  • Can you access the account in an emergency?
  • What’s the minimum and maximum you can deposit?

You can find out more in our guide on how to find the best savings account.

This story was update at 12:40pm to remove reference to postal applications, which are not possible with this bond.

Please note that the information is for information purposes only and does not constitute advice. Please refer to the particular terms and conditions of the savings account provider before committing to any financial products.

Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.

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