Saving in NS&I 'Growth Bonds'? Check NOW you haven't been rolled onto a rubbish rate
If you're one of over 300,000 savers holding NS&I's 'Guaranteed Growth Bonds', you could be missing out on £100s in interest if your bonds have auto-renewed. That's because, until this week, the interest rate you're moved to hadn't risen in line with recent rate rises elsewhere on the market. So check your rate now, as you only have 30 days from renewal to cancel and switch.
Guaranteed Growth Bond renewal rates for those renewing before 1 August 2022 were extremely low as they'd been in place since 24 November 2020 – when interest rates across the savings market were much lower than they are now. At that time, the top open market one-year fix paid just 0.85%, with the top five-year fix paying 1.3%. Currently, however, the top one-year fix pays 2.75% while the top five-year fix pays 3.35%.
In comparison, the rates Guaranteed Growth Bond users were auto-renewed to if they failed to act ranged between 0.1% for a one-year fix and 0.55% for a five-year fix. These rose from 1 August to between 1.85% and 2.55% but they still don't beat the current market-leading rates. See the table below for a full breakdown.
For more on the best savings accounts and rates, including easy-access options, see our full Top savings accounts guide – all of the accounts listed have up to £85,000 per person savings safety protection.
Fix length | NS&I Growth Bond rate (renewing before 1 Aug 22) | NS&I Growth Bonds rate (renewing from 1 Aug 22) | Top open market rate |
|---|---|---|---|
One year | 0.1% | 1.85% | 2.83% |
Two years | 0.15% | 2.25% | 3.12% |
Three years | 0.4% | 2.55% | 3.2% |
Five years | 0.55% | 2.55% | 3.35% |
Rates correct as at 1 August 2022. For the latest, see our Top savings accounts guide.
Fail to act and you'll be automatically renewed
NS&I's Guaranteed Growth Bonds are a type of fixed-rate savings account, where the interest rate is fixed for one to five years and you can't access your money during the term – not even by paying an early exit penalty (unless your bonds started before 1 May 2019, in which case you can cash them in subject to a 90 days' interest penalty).
While the bonds are no longer on sale to newbies, there are around 376,000 existing customers holding over £7 billion in them, according to the latest figures from NS&I.
If you have a bond, NS&I will write to you at least 30 days before it matures to tell you your options, which include renewing onto bonds of the same length, renewing onto bonds of a different length, or cashing in your bond. Fail to respond, and your bonds will automatically renew onto bonds of the same length.
You have 30 days to cancel bonds penalty-free
If you've renewed your bonds, or you've been rolled onto new ones automatically, but now want to take advantage of the better rates available elsewhere, you can cancel your bonds and withdraw your cash within the first 30 days without penalty.
You can cancel:
Online on the NS&I website.
By phone. Call 08085 007 007.
In writing. By sending a letter to NS&I, Sunderland, SR43 2SB. Make sure to include all relevant details including your name, address, date of birth and any reference numbers (such as your NS&I number and bond number). And don't forget to sign the letter.
Unfortunately, you can't cancel or withdraw your money if 30 days have passed since the renewal of your bonds.
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10 September 2024
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